SINGAPORE / NEW YORK (Reuters) – Bonds have suffered losses and Asian stock markets rose on Thursday in anticipation of a large loan and huge spending by the Democratic government, which is boosting growth, following elections the party controls both houses of the U.S. Congress.
The U.S. Treasury had the strongest delivery in months and the S&P 500 index reached a record high after Democrats’ victories in two Georgia races gave them close control of the Senate and the power to change their agenda. to succeed.
MSCI’s largest Asia-Pacific stock index outside Japan rose 0.5% to just a record high, led by more than 1.5% jumps in South Korean kospi manufacturer Kospi and the mining industry and bench-heavy ASX 200 in Australia.
The Japanese Nikkei rose 2% to its highest level since 1990. S&P 500 futures rose 0.6% and Nasdaq 100 futures rose 0.9% as the markets looked like a late New York session faded when chaotic protests in Washington erupted. [.N]
“It’s basically a re-inflation trade,” said Mathan Somasundaram, head of Sydney-based research firm Deep Data Analytics. The addition was that the Democrats were unexpected by most investors and “changed a lot.”
“While it has a razor-sharp margin, it gives Democrats a two-year window (to pursue their agenda),” he said. “Anything that benefits from rising prices will do well … if you look at the policies they are trying to go through, it’s about printing (money for) Main Street and not Wall Street.”
Georgia voters elect the first Black senator in state history, Raphael Warnock, and the youngest member of the Senate, Jon Ossoff. Along with Vice President Kamala Harris’ breakaway vote, the Democrats allow the chamber to control the chamber.
Subsequent bond sales boosted yields on the 10-year US Treasury by more than 1% for the first time since March. It rose to 1.0422% on Wednesday. [US/]
The US dollar also fell as the result became clearer as currency traders reckoned large and growing US trade and budget deficits would weigh on the greenback. [FRX/]
The dollar hit a low of nearly 1.349 against the euro at $ 1.2349 and moved near the level on Thursday. It also fell to a perennial trough against the Aussie, Kiwi and Swiss francs.
CAPITOL CHAOS, CHINA CRACKDOWN
The exuberance is tempered by a sell-out in technology stocks, as investors expect the sector to face taxes and regulations, and by disturbing scenes of protesters storming the Capitol to disrupt the certification of Donald Trump’s election defeat.
Wall Street indices eased from session highs as police evacuated lawmakers and struggled for more than three hours to remove the Capitol from Trump supporters.
“What gives us a little break is that the economy is still very fragile, and I think it’s unlikely that the Democrats are going to be as easy as the markets are trying to predict some of these policies,” Tim said. Chubb, chief investment officer at Wealth Advisor Girard in Pennsylvania.
Congress has since reconvened to resume electoral certification. Shares in Twitter slipped slightly after hours when the social network said Trump’s account had temporarily closed because he had violated the rules of the platform.
Meanwhile, U.S. repression of Chinese companies appears to be deepening, with sources telling Reuters that the Trump administration is considering extending investment bans on technology giants Alibaba and Tencent.
Shares in both fell about 3% in Hong Kong, and shares in three Chinese telecommunications companies that the New York Stock Exchange finally decided to remove after a week of flip-flopping also fell sharply.
Oil prices soared near a ten-month high and soared in the wake of a production cut by Saudi Arabia. Brent crude futures last rose 0.5% to $ 54.60 a barrel and US crude futures rose 0.8% to $ 51.02 a barrel.
Gold was steady at $ 1,916 per ounce and a bitcoin firm after hitting a new record high of $ 37,400.
Reporting by Tom Westbrook in Singapore, Imani Moise in New York and Joori Roh in Seoul; Edited by Sam Holmes and Jane Wardell