Premarket | U.S. midterm elections have investors on edge
ASIA-PACIFIC
Asian stock markets closed Tuesday with ups and downs amid continued global uncertainty and recession fears in several countries in the region.
The benchmark index of the Hong Kong Stock Exchange, the Hang Seng, closed today with losses of 0.23% in a session in which some of the large digital stocks were the main negative players.
Among the sub-indices, only the one that houses precisely the technology stocks, Trade & Industry, registered losses, specifically of 0.72 %, while the rest rose: Real Estate (0.11 %), Finance (0.36 %) and Services (0.95 %).
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The worst performers were e-commerce giant Alibaba (-3.73 %) and dealer group Zhongsheng Holdings (-3 %).
Also at the bottom of the list were other big names in the digital sector such as the conglomerate specializing in home-delivered food Meituan (-2.75 %) or the ‘Chinese Google’, Baidu (-2.56 %).
Other companies fared better, especially in the case of Macau casino operator Sands China (+3.64 %) or solar panel manufacturer Xinyi Solar (+3.3 %).
EUROPE
European stock markets moved with ups and downs at Tuesday’s opening, as mining companies led the falls due to concerns about the slowdown in China’s demand, and investors were also cautious ahead of the mid-term elections in the US that will determine the control of Congress.
The Stoxx 600 index was up 0.2 percent. The European basic resources index was down 0.8%, tracking declines in base metals prices as hopes that China will ease its strict ‘zero Covid’ strategy lost steam.
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Luxury giants, including LVMH and Hermès International, which have greater exposure to China, were also down 0.9% and 1.3%, respectively.
Pandora soared 7.5%, to the top of the Stoxx 600, after the Danish jewelry maker reported third-quarter sales just above expectations.
Macroeconomic releases in Europe included French exports, imports and trade balance, as well as retail sales in Italy and the Eurozone.
U.S. US
US investors will open higher as attention turns to the event of the day: the elections that will determine control of Congress.
Markets are now looking ahead to the US mid-term elections later in the day, with analysts expecting a Republican victory that would lead to a possible split in the government. A conclusive result could take days.
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These votes will be key as control of Congress and President Joe Biden’s agenda for his remaining two years in office are at stake.
Republicans are leading in the polls and many analysts believe that the most likely outcome is a divided government, with the Republican party controlling the House of Representatives and possibly the Senate going into the second half of Biden’s term.
The corporate earnings season continues. Internationally, today is the turn of Occidental Petroleum, Bayer and Walt Disney, among others.
The Redbook retail sales index will also be released.
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OIL
Oil prices fall as recession worries and worsening Covid-19 outbreaks in China sparked fears of lower fuel demand, outweighing supply concerns.
Brent crude lost 0.9% to US$96.99 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 1.2% to US$90.62 a barrel.
Both benchmarks hit their highest level since August yesterday amid reports that leaders in China, the world’s top crude importer, were considering exiting the country’s tight Covid-19 restrictions.
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However, Chinese health officials over the weekend reaffirmed commitment to their strict zero Covid policy. In addition, recent data showed that the country’s exports and imports unexpectedly contracted in October.
“I think the ongoing blockades, not to mention the doubling of zero-Covid over the weekend, are not only roiling the oil market, but continue to push back the reopening narrative negatively for prices,” said Stephen Innes, manager at SPI Asset Management.
Source: https://www.valoraanalitik.com/2022/11/08/premercado-elecciones-ee-uu-inversores
