Stock market skyrockets after supposed Biden victory & optimistic vaccine data

Monday morning stock futures rose with promising data from traders about a leading candidate for vaccine COVID-19 and the US presidential election winner Joe Biden, ending a long nagel batter, over which the candidate prevails to win the White House. Monday morning was a sunny day.

Dow contracts have increased by more than 1400 points or approximately 5 percent to extend last week’s significant gains. The S&P 500 contracts jumped over a 3% mark, while the Nasdaq contracts lagged behind the software stocks and other technical names that included the “stay-at – home” trade.

Shares of Pfizer (PFE), after announcing their clinical trial, showed more than 90% efficacy in COVID-19 preventing participants who did not show evidence of previous coronavirus infections, have jumped by more than 12% in pre-market trading. BioNTech (BNTX) shares, working with Pfizer on the vaccine, jumped over 14% more during the early sitting.

Traders have so far bets that a republican-controlled Senate would temper some of Biden’s supposed “market-negative” potentials, such as the move to increase corporate taxes. Two Senate races remain exceptionally high in Georgia and will only be decided in January, despite the relatively low odds of Democrats obtaining both sites for the party to claim a majority in the House so far.

“A divided government would constrain the Biden administration’s ability to implement plans for large-scale fiscal stimulus and public investment, tax, healthcare and climate related legislation,” analysts from BlackRock Investment Institute said in a note Saturday. “We see an increased focus on sustainability under a divided government, but through regulatory actions, rather than via tax policy or spending on green infrastructure. It also would likely signify a return to more predictable trade and foreign policy – even as U.S.-China rivalry is set to stay elevated due to bipartisan support for a more competitive stance.”

The analysts added that “some fiscal stimulus looks possible” during the lame-duck session in Congress, though the size and scope of any forthcoming package is likely to be much smaller than what a united Democratic government might have advanced.

“We’re monitoring the fiscal response closely, as a premature retrenchment could set back an economic restart that has so far surprised to the upside,” they said.

Other economists also expressed optimism that a stimulus package might get passed ahead of Inauguration Day, even after the months’ worth of discussions between Trump administration officials and congressional lawmakers fizzled out without an agreement.

“We are becoming increasingly hopeful that pressure from business leaders and vulnerable Republican Senators in 2022 will mean that something can pass before the end of the year, and very preferably before the end of the month,” Ian Shepherdson, chief economist for Pantheon Macroeconomics, said in a note Sunday.

Meanwhile, for the high-flying tech stocks that have driven the market higher for much of this year, a Biden presidential victory with a likely Republican Senate poses the “goldilocks Election outcome,” according to WedBush analyst Dan Ives.

Jay Lorrence
Jay Lorrence

Investor of 12 years and Managing Editor of Money Midnight, a news outlet focused on highly profitable investment ideas and bold underground research.

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