The new year is off to an incredible start with events on Capitol Hill last night highlighting just how big a job Joe Biden has in bringing the country back together again.
We’ve become quite desensitized to what would once be considered outrageous in recent years but what we saw in Washington on Wednesday was truly shocking. But with the election results now ratified after an extended joint session and Trump’s support waning among his allies, things may be looking up ahead of the inauguration in less than two weeks.
What has been impressive over the last couple of months is that, despite the drama around the election, investors have well and truly held their nerve. And that was evident again yesterday, with stock markets starting the day on the back foot but gaining confidence throughout the session and ending comfortably in positive territory.
It’s been a mixed European session so far, with stocks giving up earlier gains, leaving US futures only marginally higher ahead of the open. Clearly, despite all the mayhem, confidence in the institutions remains strong among investors and they have well and truly been tested this time around. The next two weeks won’t be without drama but with allies abandoning ship, Trump’s influence is waning.
It’s also been interesting to see investors taking a relaxed approach to the Georgia results, with caution earlier in the week suggesting they may not react too kindly to the outcome. As ever, the idea of something has proven to be far scarier than the outcome itself and investors, rather than hiding in fear of taxes are revelling in the prospect of more stimulus.
Perhaps it should be more of a concern that whatever the outcome, it’s bullish for stock markets. Uncertainty seems to be the only thing that puts them on the back foot in any material way. Higher US yields did very little to throw investors off either. When the Fed has your back, I guess there’s little to fear.
For a look at all of today’s economic events, check out our economic calendar. www.marketpulse.com/economic-events/
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