European Shares Seen Up As Biden Takes Key States
European stocks look set to open higher on Thursday as investors factor in a narrow victory for U.S. presidential candidate Joe Biden after he took Michigan and Wisconsin.
Republicans, however, appeared poised to retain control of the Senate, raising hopes that a divided Congress could be good for business.
Biden has called for tightening regulation for high-tech companies and increasing the tax rate on corporations and wealthy individuals.
He will also have to settle for a much smaller economic stimulus package, with Senate Majority Leader Mitch McConnell saying on Wednesday that the two sides needed to find compromise by the end of the year.
The Democratic presidential nominee is promising to reverse Trump policy moves on things ranging from the coronavirus and healthcare to the environment.
Asian markets are gaining ground and gold firmed up on a weaker dollar while oil prices fell nearly 2 percent on apprehensions surrounding the timing and size of a much-need U.S. fiscal stimulus package.
The Bank of England announces its policy decision later today and it is likely that the central bank will ramp up its huge bond-buying stimulus program to fight the coronavirus pandemic’s economic fallout.
The Federal Reserve, meanwhile, is likely to hold off from any major policy changes when it releases its latest policy statement later in the day.
U.S. stocks rose sharply overnight, with tech and healthcare companies leading the surge on the likelihood of a divided Congress. Investors ignored data showing a slower pace of U.S. private-sector job creation in October and a softening of services sector activity.
The Dow Jones Industrial Average inched up 1.3 percent to extend gains for the third straight session, while the S&P 500 surged 2.2 percent and the tech-heavy Composite index jumped as much as 3.9 percent.
European stocks ended Wednesday’s session with strong gains as the possibility of a Democratic sweep in the U.S. presidential election faded.
The pan European Stoxx 600 gained 2.1 percent. The German DAX rallied 2 percent, France’s CAC 40 index jumped 2.4 percent and the U.K.’s FTSE 100 advanced 1.7 percent.
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