US Open – Markets awaiting breakthrough

Talks continue on Capitol Hill

Stock markets have dipped as the European morning has progressed, with US futures now a little flat ahead of the open as negotiations hit a critical stage in the US and Europe.

There’s been an incredible confidence in these markets that a deal will be reached in both cases and the downside risks just don’t seem to be being factored in. Perhaps Mitch McConnell’s recent warnings to the White House about making a deal before the election are weighing a little today, with the Senate being the main barrier to an agreement.

Of course, the White House may be confident it can get the votes in the Senate to get a deal over the line and Trump may be willing to ignore the warning’s of McConnell if he thinks it could get him a second term. The real fight may not be between the White House and House Democrats after all, rather the President and Senate Republican’s as the election looms.

The end is in sight for Brexit

Here in the UK we’re hearing the same old tiresome rhetoric from London and Brussels as both sides continue to play hardball in an attempt to draw out some final concessions.

The same differences remain and it’s only a matter of time until both sides return to the negotiating table. This looks more like a PR stunt at this point, with each wanting the other side to be seen to be backing down. Times like this make me glad the deadline is the end of the year.

The reality is that both will have to make concessions if they want a deal, which they both need far more than they claim. That would be the case if we weren’t in the midst of a pandemic. The rest of us are forced to watch it unfold like a dreadful TV drama and just hope there won’t be a shocking plot twist in the season finale.

Economic Calendar

For a look at all of today’s economic events, check out our economic calendar.

 

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Market Analyst - UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a Market Analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam