Global stocks move higher as US voters cast ballots
Global stock markets mostly moved higher on Tuesday as Americans headed to the polls in critical midterm elections. The dollar dipped against the euro, while Chinese demand concerns helped push oil prices down nearly one percent.
Europe's main markets ended in the green after starting mixed, with Frankfurt adding 1.3 percent while London and Paris scored more modest gains. Markets also climbed on Wall Street, with the Dow adding over 1.0 percent, while the broader S&P 500 and tech-heavy Nasdaq closed higher as well.
"Investors are hoping for a political gridlock. That would make it difficult to pass radical policy changes," said Fawad Razaqzada market analyst with City Index and FOREX.com.
Polls opened Tuesday in crucial US elections that will shape the political fortunes of US President Joe Biden.
Biden's Democrats are facing a gargantuan struggle to hang onto control of Congress, after a race the president has cast as a "defining" moment for US democracy.
Polls show Republicans are likely to win at least one house of the legislatureand some see the prospect of split control in Washington as a scenario that lessens the risk of policy uncertainty.
"Consensus is that investors prefer political deadlock as it prevents any significant shifts in policy," added Scope Markets analyst James Hughes.
"With that looking like a real possibility, the real market turbulence may appear later in the week."
Politics aside, investors also are waiting on US inflation data due out Thursday for a pointer on the path for interest rates ahead.
In Asia, the Hong Kong and Shanghai stock markets sank as speculation about a rollback of China's strict zero-Covid policies fueled market volatility, but Tokyo ended 1.3 percent ahead.
Elsewhere, in the world of crypto finance, Binance, the world's biggest cryptocurrency platform, tweeted it has agreed to buy its financially-troubled rival FTX.com. Binance chief executive Changpeng Zhao said the group had signed a non-binding letter of intent "to fully acquire FTX.com," which is enduring "a significant liquidity crunch."
A report from the Australian Retailers Association (ARA) has shown that Aussie shoppers are expected to spend big during the country's two most anticipated shopping events, "Black Friday" and "Cyber Monday" in late November.
According to the report released on Monday, the sales are forecasted to reach 6.2 billion Australian dollars (about 4 billion U.S. dollars), an increase of 200 million Australian dollars (about 129 million U.S. dollars) from last year. It also cited data from the customer relationship management platform Salesforce's Holiday Insights Hub, which suggested that around a quarter of Christmas shopping is set to be completed in the Black Friday week, and 33 percent would already be completed in the first three weeks of November.
"We know that many people are more conscious about their household budgets with the cost of living going up and interest rates on the rise, so the Black Friday sales are an ideal time to complete your Christmas purchases, save money and ensure that your gifts are delivered on time," said ARA Chief Executive Officer Paul Zahra.
The European Union has just approved new sanctions against Russia, including a price cap on oil sales, following the United States' September 30 announcement of new economic sanctions. Both announcements are in response to Russia's annexation of four regions of Ukraine.
The goal of sanctions against
Russia is to cripple Russia's capacity to wage war and reduce Vladimir Putin's access to the materials and financing necessary to fight.
However, because there are still countries willing to purchase Russia's petroleum products, sanctions are increasing Russia's revenue, not decreasing it. Worse yet, the sanctions are driving up global oil and natural gas prices, causing spikes in inflation worldwide and, ironically, reducing the world's access to the metals and minerals necessary for the transition away from oil and natural gas.
In early March, the sanctions on Russia's oil sector had driven oil price estimates up to US$185 per barrel and the price of natural gas in Europe nearly reached $500 per barrel.