NEW YORK (dpa-AFX) – The prospect of a democratic majority in the Senate should initially support the Dow Jones Industrial on Wednesday. The broker IG valued the US leading index around three quarters of an hour before the start of trading 0.18 percent higher at 30,447 points. Technology stocks, however, are mostly expected to be in the red.
In two runoff elections in the state of Georgia, one of the Democratic Senate candidates was recently considered the winner, while the other gradually expanded its lead. If the Democrats win both elections, they would have a de facto majority in the Senate.
The Democrats already dominate the House of Representatives and the other Chamber of Congress. The Republicans of the outgoing President Donald Trump, on the other hand, could reject presidential candidates for government posts with a majority in the Senate and also put obstacles in the way of the government under Joe Biden’s proposed legislation.
Should the Democrats actually secure both Georgia seats, they would have 50 seats in the Senate, just like the Republicans. Vice-President-elect Kamala Harris can then resolve the stalemate as chairman of the chamber with her vote in favor of the government.
At the end of last year, investors were still uncomfortable with such a scenario, as they feared higher taxes. It has now been argued that Treasury Secretary-designate Janet Yellen, the former head of the central bank, is probably not keen on wanting to raise taxes quickly. In addition, Biden should initially concentrate on getting the corona pandemic under control.
Nevertheless, as early as Wednesday, investors were betting that Biden would quickly implement his ambitious climate protection goals. Shares in solar corporations such as First Solar or Sunpower thus recorded gains of between eight and more than eleven percent.
In this environment – as in Europe – bank stocks, which are strongly dependent on the economy, are likely to gain significantly. They generally benefit from the prospect of an economic recovery in the wake of the infrastructure investments announced by Biden.
Technology stocks such as Amazon, Alphabet or Facebook, however, recorded losses of between one and two percent before the market. Here investors feared that Biden could regulate large tech companies more tightly.
In addition, mega-deals by companies are likely to keep investors busy. The drugstore and pharmacy chain Walgreens Boots Alliance wants to sell the pharmaceutical wholesaler Alliance Healthcare in a billion-dollar deal. The shares in Walgreens Boots Alliance went up by a good two percent before the market. The health insurer UnitedHealth also wants to take over the domestic health data service provider Change Healthcare for a billion sum. Its shares gained a third in value in the pre-market business, while the shares of UnitedHealth lost around two percent. / La / jha /
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