Markets rise after Biden declared US president-elect
9 November 2020, 09:04
The news networks believe Joe Biden has enough electoral college votes to make him the resident of the White House.
The London stock market continued to rise on Monday after major US news networks called the presidential election for Joe Biden over the weekend.
With several states left to be declared, Mr Biden has already smashed through the 270 electoral college votes he needs to become the next White House resident.
The FTSE jumped by more than 1.7% as trading opened on Monday.
Already coming off its best week since the beginning of June, the index pushed past 6,000 points, up more than 103.
It added more than £26 billion to the value of the index.
Several states are still too close, or too early to call, so the final score in the presidential election may take several weeks.
But as Democrat Mr Biden notched up a more than 700,000-vote margin in Pennsylvania, and passed his Republican rival, Donald Trump, networks decided that the incumbent president was unable to win the state.
As a result, Pennsylvania’s electoral college votes helped Mr Biden across the 270-vote threshold needed for victory.
Joe Biden is confirmed as the 46th US President. How might the markets react? @RStockHunter has his say below #PresidentElectJoe #bidenharis2020 pic.twitter.com/XNbO5GLn43
— interactive investor (ii) (@ii_couk) November 7, 2020
The Associated Press and other outlets have since called Nevada for the former vice president, meaning that Mr Biden has 290 votes.
Georgia, North Carolina and Alaska are still up for grabs. Mr Biden leads with a narrow margin in the former. Mr Trump leads narrowly in North Carolina, but is widely expected to win Alaska with a large margin. All three races, and their 34 electoral college votes, are yet to be called.
Richard Hunter, head of markets at online platform interactive investor, said that while Mr Biden’s win is being welcomed by investors, the news that Republicans look set to hold on to the Senate is also good news for traders.
He said it “is seen as a tailwind for markets since sweeping changes are more difficult to introduce. In particular, the previous concerns of higher taxes and less regulatory interference have subsided, while an early boost to the economy from further fiscal stimulus is seen to be on the immediate agenda.”
He added: “For the UK, attention will turn once more to the discussions between the EU and the UK, with hopes of a last gasp compromise stubbornly remaining.”
