Financial markets have abandoned violence and chaos on Capitol Hill, with Dow DJIA,
and S&P 500 SPX,
reaching new highs on Wednesday and the Nikkei 225 reaching another 30-year record on Thursday.
But investor optimism could moderate as we continue into 2021, as Citi’s global strategy team said global stocks will be flat throughout the year call of the day.
Investment bank strategists have forecast only a 2% increase in the MSCI All Countries World Index 892400,
during 2021 and have neutralized their inclination towards growth sectors in favor of a rotation in value values.
The reduction in temperature in its long-term bias toward growth stocks, which has historically maintained its rating on the overweight U.S. market, is part of the foundation behind the degradation of the U.S. market to neutral. .
They also viewed the U.S. fiscal deficit as a threat to the dollar, which they hoped to weaken this year, boosting emerging markets and commodity stocks.
But bond yields, helped by a recovery in the global economy, could rise, with Citi projecting that the yield on the US Treasury in ten years (currently 1%) will reach 1.25% in the next few years. months and 1.45% at the end of the year. They said this should help financial and energy companies, which are brave in values.
The best returns are expected in the UK, where Citi expects 7% growth for the FTSE 100 UKX,
and Australia, where they await the S & P / ASX 200 XJO,
to go up 6%. Emerging markets, especially China, Korea and Russia, are distinguished by growth strategists.
His “slightly optimistic” view of global action depends on the success of COVID-19 vaccines in restarting the global economy. Citi economists predict a 5% increase in global gross domestic product in 2021, following the 3.9% contraction in 2020.
These two factors should favor the recovery of the profits of the companies, with a greater recovery of the profits by action of the most mistreated sectors.
Citi strategists said much of its recovery forecast could already be priced in the market, as the MSCI All Countries World index is trading at 20 times the agreed earnings per share, well above the long-term median term 15 times. Under this measure, the US is the most expensive of the major markets and the UK the cheapest.
As for sentiment, Citi said we are deep in the territory of euphoria at the U.S. panic / euphoria index, indicating that corrections may come. Your suggestion? Buy the bathroom.
The buzz
President Donald Trump acknowledged defeat in the U.S. presidential election and said there will be an “orderly transition” of power. His concession came after Congress certified the victory of Joe Biden and Kamala Harris, voting late into the night after a violent pro-Trump crowd stormed Capitol Hill on Wednesday.
Too: Why the stock market concentrated even when a violent crowd stormed the Capitol
Technology giants Facebook FB,
and Twitter TWTR,
took steps to limit Trump’s ability to communicate with supporters during the siege of Capitol Hill, temporarily closing his accounts amid the violence that caused four lives.
Month: World leaders Boris Johnson, Justin Trudeau and others condemn “shocking” and “shameful” scenes at the US Capitol
Senior members of the Trump administration have debated the possibility of invoking the 25th Amendment to the Constitution, according to CBS. If invoked – for the first time in history – he would eliminate Trump as president and Vice President Mike Pence would be the commander-in-chief.
Read more: Do you want to charge again? 25th Amendment? Several ideas arose to end the Trump era now
U.S. officials are considering banning Americans from investing in Alibaba and Tencent, China’s two most publicly traded companies. This would mean an expansion of the Trump administration’s effort in the final phase of the blacklist of investments in Chinese companies linked to the country’s military.
Sports betting actions such as DraftKings DKNG,
Caesars CZR,
and MGM Resorts MGM,
rose to the negotiation late Wednesday after New York Gov. Andrew Cuomo changed his tune by legalizing the practice. Cuomo said New York had the potential to be the “largest sports betting market in the United States.”
The markets
YM00 futures,
ES00,
they point slightly upward, slated for a smooth but positive opening to continue the record highs reached by Wednesday’s rally. Asian markets NIK,
HSI,
SHCOMP,
marked while the European shares SXXP,
UKX,
DAX,
PX1,
they trade just above the plan.
The market is reacting positively to the Democratic bid initiated by Georgia’s two Senate second victories, which improve the chances of more fiscal stimulus, as Vice President-elect Harris would cast unbalanced votes.
Read more: Democrats win Georgia’s second election, giving their party control of the US Senate
The graph
U.S. Treasury yields, shown in our Marshall Gittler Day chart on BDSwiss, increased dramatically as Democrats were called for in both Senate races in Georgia. 10-year yields TMUBMUSD10Y,
they increased 8 basis points to 1.04%, the first time they exceeded 1% since mid-March 2020.
The tweet
YouGov investigations found that one in five voters approved of the Capitol Hill takeover and that most Republicans blamed President-elect Biden.
Random readings
The new pub gets traffic during closure after opening into a nursing home.
In the flame: the flame ‘Very chill’ was found wandering the road in Massachusetts.
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