Markets Rise Despite the Chaos in Washington: Live Business Updates
A pro-Trump mob stormed the Washington Capitol on Wednesday. Recognition…Erin Schaff / The New York Times
Wall Street appeared to be soaring on Thursday, despite the chaos from the previous day in Washington, when a pro-Trump mob overran the Capitol, forcing lawmakers to go into hiding and sparking international outrage and concern.
S&P 500 futures suggest gains if trading starts later Thursday morning on Wall Street. The European stock indices were moderately higher, with the Stoxx Europe 600 increasing by 0.2 percent and the German DAX index by 0.4 percent. Most of the Asian indices closed higher.
Even while gun scenes were drawn in the congress halls on Wednesday afternoon, the S & P 500 was able to hold onto its profits and closed 0.6 percent higher. Overall, this was yet another example of how stock markets seemed disconnected from reality – see last year’s double-digit gains on Wall Street as a pandemic choked the global economy.
The Senate and House of Representatives voted early Thursday to certify Joseph R. Biden Jr. as the winner of the 2020 presidential election.
The democratic scrutiny of the U.S. Senate, made possible by the results of two runoff elections in Georgia this week, should make it easier for Mr Biden to take stimulus measures to strengthen the economy. Investors are also betting on the launch of coronavirus vaccines to ultimately fuel business that was inactive during the pandemic.
“The markets have paid very little attention to riotous behavior in Washington,” ING analysts wrote in a note. Instead, investors have retained an interest in riskier assets like stocks, sparked by the success of the Democrats in Georgia.
Treasury bond yields continued to rise, fueled by expectations that additional budget spending in Washington will lead to more bond issuance, reaching as high as 1.06 percent on 10-year bonds. The yield rose above 1 percent this week for the first time since March.
Goldman Sachs economists said they expected the Democrats to create $ 750 billion in fiscal stimulus in the first quarter of the year after taking control of the Senate. The US investment bank raised its forecast for economic growth this year from 5.9 percent to 6.4 percent.
Oil held at an 11-month high after Saudi Arabia announced on Tuesday that it would cut oil production. The US crude oil benchmark West Texas Intermediate, which was up 0.6 percent that day, hit $ 51.28 a barrel before slipping a little while Brent crude hit $ 54.90.
When Jamie Dimon, executive director of JPMorgan Chase, issued a statement on Wednesday condemning the violence in Washington, he urged “our elected leaders” to call for an end. He did not directly mention President Trump.
Also Charles Scharf, the managing director of Wells Fargo (“The behavior in Washington, DC, is not acceptable today”) or the managing director of Goldman Sachs, Bank of America or Citigroup. Instead, business leaders and organizations often referred to “leaders” or called for a “peaceful transfer of power” to President-elect Joseph R. Biden Jr.
Business leaders have rarely criticized Mr. Trump directly. When he announced shortly before his inauguration that Stephen K. Bannon would be his chief strategist in the White House, the Democrats on the Congressional committees that oversee the financial industry urged industry leaders to publicly oppose the appointment. Lawmakers called Mr Bannon a “bigot loved by white supremacists” and said business leaders had “a moral obligation to speak up”.
After Mr. Trump took office, executives found themselves in the uncomfortable position of deciding whether to participate in so-called corporate councils, common forums for corporate leaders to influence a new president’s policies, even as he put in place guidelines that many saw as hateful at. Several such councils disbanded after Mr. Trump refused to condemn the violence of white supremacists in Charlottesville, Virginia in 2017, saying there were “very good people” and “guilt” on “both sides”.
With the president’s increasing efforts to undermine the elections, organizations have grown bolder. For example, on Monday, 170 business leaders signed their names in a statement organized by the corporate agency Partnership for New York City, calling on Congress to confirm the presidential election result, even though some prominent members were missing.
On Wednesday, when a mob stormed the Capitol, organizations not known for what they said seemed no longer to worry about the political consequences of speaking out against Mr. Trump.
For the first time since the September 11, 2001 attacks, the High Frequency Economics research group has suspended regular publication of its research notes and sent a note to its clients: “We at High Frequency Economics are concerned about the role of President of the United States instigated this insurrection , and we are saddened that he cannot find the character to stand in front of the mob he has created, suppress the violence and send everyone home. “
And the Business Roundtable, a group of executives, including Mr. Dimon, from some of the largest corporations in the country, was right on the cause of the violence.
“The chaos in the nation’s capital is the result of unlawful efforts to undo the legitimate results of a democratic election,” the group said. “The country deserves better. The Business Roundtable calls on the President and all relevant officials to put an end to the chaos and facilitate the peaceful transfer of power. “
The Royal Divinity Food Bank in Birmingham, Alabama says it has fed hundreds more families every month since the pandemic began. The labor market has improved, but millions remain unemployed.Recognition…Audra Melton for the New York Times
The Labor Department is due to come up with new evidence of the levels of unemployment across the country on Thursday morning when it releases its weekly unemployment claims report.
Initial benefit entitlements remained at levels not seen in previous recessions, and analysts polled by Bloomberg expect an increase from last week’s report.
“Google search trends show an upward trend in terms of” file for unemployment “that lasted until this week,” said Julia Pollak, employment economist at ZipRecruiter online job board.
“The virus is still spreading, hospital stays have hit a new record and the demand for certain services is falling,” Ms. Pollak said. “Many orders and restrictions on staying at home lead to a further decline. You see a drop in restaurant data everywhere. “
Before adjusting for seasonal fluctuations, the new state claims for unemployment benefits were over 800,000 in each of the last four weekly reports.
The job market has improved and the economy has closed since the coronavirus pandemic broke out. Of the more than 22 million jobs that disappeared in the spring, 10 million will be lost.
“Employers are very careful about hiring while they have had to increase layoffs,” said Kathy Bostjancic, chief US financial economist at Oxford Economics. “The virus resurgence is really the main culprit here.”
“It is worth noting that wage increases have been falling ever since August,” said Ms. Bostjancic.
With a recently passed US $ 900 billion aid package that includes an increase in federal unemployment benefits, most unemployed can at least look forward to more financial aid.
A fuller picture of December employment will emerge on Friday when the Department of Labor releases its monthly job report and most analysts expect modest wage increases – or even the first net loss since April.