Biden has chosen former Federal Reserve Chair Janet Yellen as treasury secretary
Wall Street stocks finished higher on Monday, as investors continued to cheer news on the development of coronavirus vaccines and the fact that the US government gave the green light for President-elect Joe Biden’s transition. Also on the positive side, the IHS Markit’s manufacturing PMI for the US edged higher to 56.7 in November from 53.4 in October versus 53 expected while the Services PMI rose to 57.7 from 56.9 and exceeded an estimate of 55.3. As a result, the S&P 500 rose 0.56%, the Dow Jones Industrial Average gained 1.12%, and the technology-heavy Nasdaq Composite added 0.21%.
Asian equities were mostly higher on Tuesday, with markets digesting positive political developments in the United States. Adding to investor optimism, Biden has chosen former Federal Reserve Chair Janet Yellen as treasury secretary. The latest vaccine developments were also helping to raise hopes for the eventual economic recovery. As such, Japan’s Nikkei 225 jumped 2.50%, South Korea’s Kospi added 0.58%, Australia’s S&P/ASX 200 gained 1.25% while the Shanghai Composite in China slipped 0.34%.
In Europe, stocks opened in the green, also cheering the news that that the Trump administration has accepted President-elect Joe Biden’s transition into office. Meanwhile, Germany’s GDP grew by a record of 8.5% in the third quarter, with a stronger-than-expected rebound being mainly driven by higher household spending. The headline German IFO Business Climate Index came in at 90.7 for November, in line with consensus estimates. The pan-European Stoxx 600 climbed 0.7% in early trade.
Elsewhere, the euro reclaimed the upside bias after a strong rejection from the 1.1900 handle seen yesterday. EURUSD has recovered to the 1.1880 area in recent trading, also helped by relatively upbeat economic data out of Germany. Still, the pair needs to make a decisive break above the 1.1900 figure in order to see a bullish extension in the short term. Otherwise, a correction could be expected.
