In anticipation of important signals from the US labor market and the outcome of the Senate election in Georgia, Europe’s investors only hesitantly ventured forward on Wednesday. Dax and EuroSToxx50 climbed 0.7 percent each morning to 13,749 and 3,577 points.
Due to the continuing rampant corona pandemic, experts expect the job creation in the USA to slow down to 88,000 in December from 307,000 in the previous month. The figures from the private employment agency ADP give a foretaste of the official data on Friday.
Investors accepted the tightened corona restrictions in Germany without complaint. “On the stock exchange, however, people have already come to terms with the fact that the restrictions in Europe will continue for a few more weeks,” said analyst Milan Cutkovic from the trading company Axi. “This is likely to lead to occasional mood swings among investors, but the equity rally should not slow this down.”
HEAD-TO-HEAD RACE IN GEORGIA – DEMOCRATS FRONT
The runoff election for the two Senate posts of the US state of Georgia, which should decide on the political freedom of action of President-elect Joe Biden, initially made investors cautious. If the Democrats of the US President-elect should gain the upper hand in the Senate as well as the House of Representatives, experts expect additional state spending programs. This expectation was reflected in higher raw material prices: the copper price was moving towards an eight-year high, and the prices for steel and nickel also rose.
However, speculation put pressure on higher corporate taxation and stricter regulation under Biden pre-trading on Wall Street, especially the prices of technology stocks such as Apple and Microsoft.
OIL SECTOR BENEFITS FROM ELEVEN-MONTH PRICES
The biggest winners across Europe included financials and the oil and gas sector, which benefited from rising oil prices. In London, the shares of the oil companies BP and Royal Dutch Shell rose by up to 4.3 percent. Saudi Arabia’s new production cuts drove the oil price to its highest level in around eleven months. The North Sea variety Brent rose in price by up to 0.9 percent to 54.09 dollars per barrel, US light oil WTI rose to 50.24 dollars and was thus also not as expensive as it has been since February last year. Saudi Arabia wants to persuade most of the states in the OPEC + to refrain from increasing production in order to support the oil market.
BITCOIN RISES OVER 35,000 DOLLARS – ALTERNATIVE TO GOLD?
Bitcoin cracked the next important mark on its record rally, trading above $ 35,000 for the first time. The price of the oldest and most important cyber currency on the Bitstamp exchange has risen to $ 35,879 after more than tripling in the past three months.
According to strategists, an optimistic assessment by analysts at JP Morgan helped the price. They believe an increase to $ 146,000 is possible if the digital currency should establish itself as an investment alternative to gold, which is considered a safe haven. “In our opinion, bitcoin’s competition with gold has already begun,” said the current study. That could represent a new departure for the volatile digital currency after years of being a game for speculators and small investors. “Given how big the financial investments are in gold, the displacement of gold as an ‘alternative’ currency means great long-term potential for Bitcoin.”