Markets ignored the riot around the Capitol

The markets reacted very moderately to the capture of the American Capitol by supporters of the incumbent President Donald Trump, who lost the election. No matter how bright and tragic the picture may be, nothing bad has happened for the economy, say . Nasdaq analysts

Despite the beginning of violent protests in the US, the Dow Jones index managed to close at a historical high on January 6. Trading on January 7 in the US opened with growth of the S&P 500 and Nasdaq-100 within 1%, the Dow Jones index in the first minutes of trading rose by 0.4%.

This dynamic is explained by the fact that the House of Representatives and the Senate at a nightly joint meeting - after the protesters were expelled from the parliament building - finally approved Democrat Joe Biden as the winner of the 2020 presidential election. And Donald Trump promised an orderly transfer of power, though he reserved the right to challenge the legality of the vote. This means that the constitutional order in the world's largest economy will be respected.

“There is no mystery in the lack of reaction of the markets to the events around the Capitol, no matter how monstrous, ridiculous and shameful they may seem. They simply have nothing to do with the economy, profits and interest rates, ” quotes Bleakley Advisory Group investment director Peter Bukvar Marketwatch. In the same way, more than reservedly, investors treated last year's racial protests, recalls the NYT.

Foreign markets also reacted weakly to the news from the US: in Europe on Thursday, January 7, there was no single dynamics, and Asian markets mostly closed with growth. Brent oil, which confidently stepped over $53 after the OPEC+ decision on production, remained above this level.

for the first time since March 2020 The only exception was the US government bond market, where 10-year yields jumped over 1% . But this growth was also caused mainly by the loss of the majority in the Senate by the Republicans (representation was distributed 50 to 50). The shift in power suggests that the Biden administration's future costly initiatives will be much easier, which means investors should factor in heavy federal spending and borrowing. This does not change the status of US government bonds as one of the most low-risk assets.