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Capitol

Storming The Capitol, What happened to the markets?

Storming The Capitol

What happened to the markets?

Storming the Capitol : A disastrous historic night in Washington yesterday,
as there were riots for the first time in recent history, chaos and gatherings in thousands of Trump supporters.

Tension arose when US Vice President Mike Pence,
the speaker of the Senate, refused to approve Donald Trump’s request that Joe Biden’s
electoral votes be rejected in disputed states such as Arizona, Georgia and Pennsylvania.

As a result, several hundred supporters of the outgoing president stormed the Capitol,
the seat of US Parliament, Senate, and House of Representatives.

Pictures of people wearing various fancy dress, taking photos of themselves appeared in halls of Parliament
and in the offices of Congress members including Nancy Pelosi, Speaker of the House of Representatives.

One person was injured and died later in hospital after being struck by bullets.

A curfew was imposed in Washington City to prevent mass gathering.

During clashes with security services, a number of people were injured and dozens were arrested for violating curfew.

Evest follows up all developments in markets after this night that Americans will never forget.

US West Texas crude is over $ 51

Oil prices rose today after a historic night in United States of America as they are still supported
by a reduce in production by Kingdom of Saudi Arabia and a decline in oil inventories.

Brent crude recorded $ 45.72 a barrel, rising by 0.77%, while US west Texas Intermediate crude rose by $ 0.93%,
as a barrel was trading at $ 51.10.

Oil prices rose to their highest levels since February 2020 as markets are still buoyant following Kingdom of Saudi Arabia
as it announced that it would voluntarily reduce its production by a million barrel a day in February and March.

According to OANDA analyst, US crude has chances to rise again as Biden administration will tighten screws on US crude production.

Saudis have initially alleviated supply concerns by reducing them by a million barrel a day and other easing may come indirectly from USA.

On the other hand, Energy Information Administration issued its official weekly report of oil stockpiles yesterday.

Stocks decreased by 8 million barrels during last week ending on January 1, 2021,
despite expectations of a decline of only 2.1 million barrels.

According to Reuters, decline in crude stocks is a typical event at the end of the year as
energy companies take oil out of storage to avoid tax bills.

Gold has not been positively affected after yesterday’s events

Gold rose today as Democrats were declared victorious in Georgia’s elections which boosted a possibility of further fiscal stimulus.

Careful tone of Federal Reserve Bank regarding US economy and disappointing jobs report increased expectations of early stimulus measures especially since everything is now in hands of Joe Biden, such as, Presidency, House of Representatives and Senate.

Nevertheless, strong US Treasury yields limited Thursday’s gains as gold rose by less than 0.1% to trade at $ 1926 an ounce.

Gold rose from its daily lows as crowds of Trump supporters stormed US Capitol as lawmakers believed President-elect Joe Biden had won over President Donald Trump.

US Capitol has been put into lockdown as pro-Trump protesters breach security barriers with US lawmakers indoors.

Yesterday, gold fell to its lowest level in session at $ 1902 an ounce.

This is the lowest level of gold since the quarter of current January.

Dollar is rising against a basket of currencies after recovering from its lowest level through 3 years

US dollar fell to trade near its lowest level in 3 years after Democrats reaped everything in United States of America.

This leads to increase Biden’s power and supports his policy.

According to Reuters, analysts generally assume that Democratic-controlled Senate will be positive
for global economic growth and thus for most risky assets,
but it will be negative for bonds and dollar as trade deficit in US budget may widen.

Despite great chaos that occurred in USA yesterday, currency market is now stable as it is.

US dollar index declined today to 89.321 after reaching 89.206 overnight.

This is its lowest level since March 2018.

Despite of this decline of US dollar, it managed to rise against a basket of major currencies even
if by small percentages, as euro fell against US dollar by 0.01% recording 1.2320 and sterling fell against green currency by 0.13% to record 1.3585.

Australian dollar and New Zealand dollar fell against greenback by 0.09% and 0.08% at 0.7792 and 0.7284, respectively.

Dollar rose against Japanese yen by 0.25% to trade at 103.299,
while it fell by 0.09% against Chinese Yuan to trade at 6.4565.

How was stock market performance?

US equity futures rose as Senate rejected the second challenge of Democratic
President-elect Joe Biden’s votes after police dispersed the crowd that stormed Capitol.

According to Evest Tracks, S&P 500 futures rose by 0.6%, while Nasdaq100 futures fell0.6%, but Dow Jones futures rose to 1.4%.

In Asia, Nikkei rose by 1.6%, Shenzhen rose by 1.1%, while S & P /ASX 200 rose to 1.59%,
and Kospi rose by 2.1%, as markets rejoiced with the victory of Democrats in US Georgia.

Hang Seng index declined to 0.17%.

European markets are expected to open trading today on a positive note,
after main indexes of European stock exchanges collectively ended their trading in green zone, yesterday.

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