The world stock exchanges are betting, polls in hand, on a possible victory by Joe Biden against Trump in the American presidential elections, an outcome that would bring closer an agreement on the maxi-stimulus plan between Democrats and Republicans. The markets on the eve of the vote therefore seem to distance the most feared scenario, that of an uncertain electoral outcome that does not give immediate certainty about the name of the future US president.
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The race of Piazza Affari: best stock exchange in Europe
And so, while the pre-electoral euphoria infects Wall Street, the European lists are dragged up and in the end the best Piazza Affari which earns 3.2% and forgets – for the second session in a row – the upcoming lockdowns and the increase in Covid infections.
On the Ftse Mib the first place belongs to Ferrari (+ 7.1%) which surprised analysts with an above-estimated quarter and a record order backlog. On the second step it always touches the car with Pirelli (+ 6%) and the industry with Leonardo (+ 5.5%). Rises for credit institutions, starting from UniCredit (+ 3.9%) but Mps slips (-2.4%), while the president of the ECB’s Banking Supervisory Council, Andrea Enria, stresses that participation in the network of European bad banks in which we work must be limited to banks which, in the opinion of the supervisor, have a sustainable business model.
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The European stock exchanges are running
The session was euphoric on all the main financial markets of the Old Continent. Behind Milan is the stock exchange of Frankfurt, which closed with an increase of 2.55%, followed on the third step of the podium by that of Madrid (up by 2.52%). Right behind there are Paris (+2,44%), London (+2,33%) e Zurich (+2,17%).
On the currency market, the greenback continues to decline with the euro / dollar exchange rate at 1.1735 (against 1.1637 on Monday) while the dollar / yen stands at 104.51 (from 104.79). The pound also recovered to 1.307 against the US currency (from 1.2903). Finally, the prospect of a delay in the timing by OPEC + countries to reduce production cuts has led to a rise in oil prices: the December WTI is worth 38.1 dollars (+ 3.5%) and the Brent $ 40.1 in January (+2.9 percent).
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The opening of Wall Street
Wall Street proceeds sharply up on US presidential election day. Investors are betting on a clear outcome of the voting results after a tense and controversial election campaign. Just under three hours after opening, the Dow Jones is up 2.15%, the Nasdaq by 1.88% and the S&P 500 by 1.96%.
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Stability and then growth if Biden wins …
Whatever the outcome of the vote in the United States, it is unlikely that we will see a fall in prices and we can rather expect a positive or moderately bullish reaction, explains Alessandro Capeccia, portolio manager of Azimut sgr, one of the leading independent management companies. savings in Italy with an important operational presence also in the United States. If the polls are confirmed and there is a victory for Democratic candidate Joe Biden, the immediate reaction will be contained because the hypotheses of higher taxation on the income of individuals and companies and industrial policies alternative to those pursued to date by the Trump administration have widely discounted by investors. In the medium term, a Biden victory could indeed encourage a bullish trend on Wall Street thanks to the policies of increasing public spending generally implemented by Democrats, says Capeccia.
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Immediate euphoria and then retracement if Trump wins
Conversely, a reconfirmation by Donald Trump could be accompanied by a similar response, but symmetrical, compared to the one that the American stock exchange had at the time of the election of the current president. Four years ago, Trump’s victory was accompanied by an immediate drop in indices which was followed by a long period of bull market. In today’s elections, the opposite could happen: with an immediate rise in Wall Street followed by a period of downsizing of share prices due to the difficulties of this administration in dealing with the emergency of the pandemic and the supportive policies for the economy necessary to face it.
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