The first trading session of 2021 began with a whimper on Monday, with all three major U.S. markets dropping more than 1%, as risk appetite wavered over uncertainty regarding the U.S. Senate runoff elections in Georgia and surging coronavirus cases. The Dow plunged 383 points, the S&P 500 fell 55, while the Nasdaq dropped 190 points. However, the TSX bucked Monday’s trend, rising 94 points, thanks to a strong rally in materials stocks, as the price of bullion rose more than 2% to its highest level in nearly two months amid a slide in the U.S. dollar.
U.S. stocks bounced back modestly Tuesday as investors eagerly awaited the outcome of the closely contested Georgia races. A Democratic sweep of both seats would make it much easier for President-elect Joe Biden’s administration to pass new legislation, including additional fiscal stimulus. U.S. stocks also got a boost from news that U.S. manufacturing activity jumped in December. In Canada, the TSX hit its highest levels since February as the energy sector saw oil prices surge to a 10-month high.
Wednesday was an historic day in the U.S. – in more ways than one — as Dems took control of the Senate with Georgia runoff victories for both Jon Ossoff and Raphael Warnock, the state’s first-ever black senator. The unexpected results from Tuesday’s election upended markets, sending investors on a buying spree of bank shares and other cyclicals that stand to benefit from further stimulus. Conversely, big tech names declined more than 2% as investors worried that a Democratic- controlled Congress would lead to higher taxes and tighter regulations. Meanwhile, 10-year U.S. Treasury yields climbed above 1% for the first time since March as investors dumped government bonds in anticipation of more government borrowing.
source https://richarddri.ca/markets-react-as-dems-take-senate-races-trump-mob-storms-capitol/
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