Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Opening Bell: Futures, Stocks Still Risk-On Despite DC Chaos; Bitcoin Hits $37K

By Investing.com (Pinchas Cohen/Investing.com)Market OverviewJan 07, 2021 12:27
uk.investing.com/analysis/opening-bell-futures-stocks-still-riskon-despite-dc-chaos-bitcoin-hits-37k-200451851
Opening Bell: Futures, Stocks Still Risk-On Despite DC Chaos; Bitcoin Hits $37K
By Investing.com (Pinchas Cohen/Investing.com)   |  Jan 07, 2021 12:27
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
  • Market is risk-on despite Capitol unrest
  • Gold and the dollar are up
  • Bitcoin scores new all-time high above $37,000

Key Events

US futures, including for the Dow, S&P and NASDAQ and European stocks advanced for a second day on Thursday on the hope of a fiscal top-up after the double Democratic win in Georgia which gives President-elect Joseph Biden full control of Congress and thus a clearer path for his political agenda. Futures on the Russell 2000, however, are in the red after the small cap index jumped almost 4% on Wednesday.

Lawmakers finally certifying Biden's election to the presidency early this morning has also provided a sense of stability, after Trump supporters stormed the Capitol on Wednesday. As well, a large-scale vaccine rollout across Europe, following approval of the Moderna (NASDAQ:MRNA) vaccine there, is boosting hopes for an economic recovery.

Global Financial Affairs

In Europe, the STOXX 600 Index climbed 0.4%, nearing February highs. Growth sensitive cyclical sectors, such as miners, energy and construction and materials resumed a rally on the view that as Democrats have regained control of Congress, the Biden Administration will provide additional fiscal supports.

Stocks in Asia this morning followed Wednesday's rallies on Wall Street, disregarding images of a chaotic mob breaking into the US Capitol.

China’s Shanghai Composite rose 0.7%, extending a rally to its sixth session in a row, after the PBoC promised to keep policy accommodative in 2021. In Japan, the Nikkei jumped 1.6%, after a four straight day loss, hitting a 30-year high. The South Korean KOSPI outperformed in the region, jumping 2.1%, hitting another record high, thanks to strong foreign and institutional buying.

On Wednesday, US markets closed in the green but well off their highs. The S&P 500 Index gave up a 1.5%, closing with a 0.6% gain. Positive news in the Senate runoffs sparked a reflation trade, attracting demand to small cap shares that benefit from an economic rebound and banks that profit from higher interest.

After oscillating yesterday, the VIX closed lower.

VIX Daily
VIX Daily

Today the volatility index fell further, for the third straight day, indicating investors are still decidedly bullish.

Yields, including for the 10-year Treasury note, climbed for the third day to 1.06.

Treasuries Daily
Treasuries Daily

Rates established an uptrend, after breaking through the 0.96 resistance, as well as the psychological 1.00% level.

The dollar moved higher for the second day. The greenback didn’t rise on its safe haven status, as dollar-denominated Treasuries were sold off, and the same theme that is lifting stocks—more money in the system—dilutes the dollar’s value.

Dollar Index Daily
Dollar Index Daily

We expect the USD to resume its fall, as it finds resistance by the previous lows, after breaking the support of the Jan. 4 hammer.

Gold opened higher by more than 0.5%, extending gains to 0.7%, paring Wednesday’s steep selloff.

Gold Daily
Gold Daily

While that session’s long, red candle may appear to complete an Evening Star—a three-candle bearish pattern—we are not concerned. The star—or the middle candle—is not above the two outside candles. We’re more impressed by the fact that despite 2.3% price plunge, the yellow metal found support above the pennant and falling channel.

Unstoppable Bitcoin climbed for the third day—or for the 10th day out of 11—to post a new all-time high of $37,722.

Bitcoin Daily
Bitcoin Daily

Remember: remarkably, it's only 3 weeks since the cryptocurrency surpassed the $20,000 mark.

Oil edged higher on the prospect that economies will reopen as vaccination programs are rolled out. This build was on top of a previous boost to crude prices when Saudi Arabia surprised the market, pledging to cut output by one million barrels a day in February.

Oil Daily
Oil Daily

The price of oil rose for a third straight day, breaking through the Dec. 18 high, extending the uptrend.

Up Ahead

Market Moves

Stocks

Currencies

  • The Dollar Index gained 0.2% to 86.69.
  • The euro fell 0.3% to $1.2297.
  • The British pound was little changed at $1.3609.
  • The Japanese yen weakened 0.3% to 103.40 per dollar.

Bonds

  • The yield on 10-year Treasuries jumped two basis points to 1.06%.
  • The yield on two-year Treasuries gained less than one basis point to 0.14%.
  • Germany’s 10-year yield was unchanged at -0.52%.
  • Britain’s 10-year yield rose one basis point to 0.253%.

Commodities

  • West Texas Intermediate crude gained 1% to $51.01 a barrel.
  • Gold was little changed at $1,918.93 an ounce.
Opening Bell: Futures, Stocks Still Risk-On Despite DC Chaos; Bitcoin Hits $37K
 

Related Articles

Opening Bell: Futures, Stocks Still Risk-On Despite DC Chaos; Bitcoin Hits $37K

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
souheil faraj
souheil faraj Jan 07, 2021 12:32
Saved. See Saved Items.
This comment has already been saved in your Saved Items
You have no idea. You say the gold is up. It is not . Infact its down
Fahima Adam
Fahima Adam Jan 07, 2021 12:32
Saved. See Saved Items.
This comment has already been saved in your Saved Items
It’s crazy, gold is plummeting, I’m at a massive loss already
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email