Daily summary: Markets welcome Biden transition

•  Formal transition of power to Biden begins
• Dow Jones hit an all-time intraday high
• Biden picks Janet Yellen for Treasury Secretary

European indices finished today's session higher, with DAX 30 closing at its highest level since February 21st, while other major indexes gained between 1.2% and 2% on vaccine optimism and upbeat macroeconomic data. Germany's GDP figures showed that Europe's largest economic activity rebounded more than initially thought in the third quarter and business morale in Germany and France deteriorated less than forecast.

US indices are also trading higher in relief over the Trump administration’s move to begin the transition process. Dow Jones rose 1.4%, and hit an all-time intraday high. The S&P 500 added nearly 1.5% and Nasdaq  advanced 0.9%. US General Services Administration acknowledged Joe Biden as the apparent winner of the presidential election and President Trump asked the agencies to begin the transition of power, even as he vowed to keep contesting his election defeat. Also investors welcomed the news that Joe Biden will nominate former Federal Reserve Chair Janet Yellen to be Treasury Secretary which is perceived by many as a market-friendly pick taking into consideration that she oversaw a long economic expansion with historically low-interest rates and will probably insist on further fiscal stimulus. Meanwhile ever-increasing number of new coronavirus cases prompted some Wall Street firms including Goldman Sachs and JPMorgan to lower their near-term economic outlook. Yesterday US reported 172,300 new COVID-19 infections and the situation could worsen in the coming days as around 50 million Americans will travel to celebrate the upcoming Thanksgiving Day. The seven-day average of new infections increased more than 10% over the previous week to an all-time high of 176,434.

 

US crude futures are trading more than 4.0% higher while the international benchmark Brent contract rose over 3.5%. Saudi Arabia's energy ministry confirmed that recent attack made by the Houthi rebels in Yemen caused a fire at an oil tank inside a fuel-distribution center. Traders now await for the API report due later in the day. Elsewhere, gold futures fell for the second session to $1802/oz which is the level not seen since July, while silver futures fell 1.5% amid an increase in investors' risk appetite.

USDJPY – pair managed to break above the major resistance level at 104.27 and is currently testing the 200 SMA (red line). If buyers will manage to uphold current momentum, then another upward impulse towards resistance at 105.07 could be launched. This level also coincides with the long term downward trendline. Source: xStation5

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