Irony of history: US President Donald Trump has long boasted of being a friend of the stock exchanges. During his tenure, the Dow Jones index rose. Now he is skipping a historic mark. However, because the man in the White House apparently finally accepts the end of his term in office.
The prospect of an orderly transfer of power in the United States and success in developing vaccines against the coronavirus are giving Wall Street a boost. The US standard value index Dow Jones subsequently crossed the 30,000 mark for the first time – and was able to maintain its profits.
In the end the Dow Jones Index 1.5 percent firmer at 30,046 points. The broader one S&P 500 as well as the technology-based Nasdaq composite improved by 1.6 and 1.3 percent. "Although the election results did not pose a serious threat to the market, investors are excited about the elimination of a potentially chaotic political process," said Spartan Capital Securities market economist Peter Cardillo.
According to stockbrokers, investors are relieved that US President Donald Trump has given in and cleared the way for an orderly transfer of power to his elected successor Joe Biden. The nomination of former US Federal Reserve chief Janet Yellen, who is considered to be business-friendly, as future Treasury Secretary is also positive. At the same time, investors are betting on the rapid approval of coronavirus vaccines and a return to normalcy.
Wanted oil values
With the boom in oil prices, the sector stocks were also sought after: Exxon Mobil increased by 6.7 percent, Chevron by 5 percent. The title of the oil service provider Baker Hughes increased by 5.2 percent. The sector index rose by 5.2 percent.
JP Morgan advanced 4.6 percent. A subsidiary of the major bank had settled a dispute with the OCC currency regulator over inadequate internal controls. In return, the US bank has to pay a civil fine of $ 250 million.
The selection index, which is simply called "Dow" in stock market jargon, crowned a month-long, impressive race to catch up: After the coronavirus outbreak in China in February, the US benchmark index fell from over 29,000 points by more than 10,000 points or almost 40 percent in just four weeks . But by the beginning of September these losses were made up for again.
The Dow Jones is one of the oldest stock market indices in the world. It was calculated for the first time in 1896. In June 2018, General Electric, the last company to have been listed in the index since the beginning, left the company. At the time of Trump's inauguration in January 2017, the Dow stood at around 20,000 points. Due to the ongoing low interest rate policy of central banks around the world, tax breaks in the USA and the lifting of conditions and international obligations during his term in office, the index rose by around 50 percent.
Looking for car values in Germany
The same situation in Europe caused prices to rise. The leading German index Dax closed 1.3 percent firmer at 13,292 points and ended trading at its highest level since February 21. Another big topic on the market was the index reform – the Dax should include 40 instead of 30 values from September.
In the market, investors are betting on a normalization of life and the economy in the coming year, which is also likely to be associated with greater mobility of the people. The Car values Daimler, BMW and VW as well as the supplier Continental posted profits. The same applies to the travel sector: the airline's papers Lufthansa became significantly more expensive. In return, defensive real estate stocks were avoided: Vonovia and Deutsche Wohnen lost. However, both had announced an investment freeze for their holdings in the capital the day before. The reason is the rent cover.
"The environment has brightened further," said a trader. The first analysts are now seeing opportunities for a new Dax record above 13,800 points. "The likelihood of a much better economic situation in the second half of the coming year increases with every new vaccine news," said analyst Jochen Stanzl from trading house CMC Markets.
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There was also a clear upward trend across Europe: The EuroStoxx 50 As the leading barometer of the euro zone, the French posted a premium of 1.3 percent to 3508 points Cac 40 and the British FTSE 100 recorded similarly strong price gains.