The riots in the United States have come to an end and Donald Trump formally acknowledged his loss in the presidential elections, also condemning the mayhem his supporters caused when they stormed the Capitol this week.
Meanwhile, Trump is now potentially facing a second impeachment charge and may also be under investigation for the role he played in instigating the riots, which claimed the lives of five people. But with just 12 days left in office, his forceful removal might not make a big difference.
The markets now have enough reassurance to expect the smooth running of Joe Biden’s presidency. This entails more spending and fiscal stimulus, as well as a backing of the Federal Reserve’s accommodative monetary policy.
As a result, stock indices rallied around the world and risk appetite increased. Metals have been among the biggest winners, together with cryptocurrencies. Bitcoin reached a historic maximum above $40,000.
Today the economic calendar is quite loaded with events. Household spending in Japan was better than anticipated, while the unemployment rate in Switzerland increased to 3.5%. Trade reports from France and Germany neither impressed nor disappointed investors. However, the unemployment rate in the eurozone dropped tp 8.3% in November, which is better than the forecasts.
In Canada, unemployment matched the forecasts at 8.6% in December, but the employment change report was much worse than anticipated. A similar scenario occurred in the United States, where the unemployment rate was slightly lower than the forecasts (typically a good sign), but the non farm payrolls were significantly lower than expected, even as hourly earnings grew.
In other news, the World Health Organization warned that the coronavirus pandemic might persist for at least another six months, despite the increasing availability of vaccines. Cases worldwide have surpassed 88.6 million, with 1.9 million deaths.
The United States had its highest ever daily increase in infections yesterday, with nearly 280,000 new cases. Brazil is raising an alarm as well, with close to 90,000 new cases yesterday, after reporting daily averages of around 20,000-25,000 for the past few weeks.
In Europe, France, Italy, Germany, Spain, and the Czech Republic are all seeing an increase in the infection rate. The United Kingdom is still in the midst of its worst Covid-19 outbreak, thanks to the new highly contagious mutation of the virus there. The new strain of Covid has made its way across Europe, raising concerns about another serious wave of the pandemic and the need for more lockdowns.
