By Peter Nurse
Investing.com - European stock markets are seen opening lower Friday, consolidating after the substantial post-election bounce, as the wait for the identity of the next U.S. president continues.
At 2:05 AM ET (0705 GMT), the DAX futures contract in Germany traded 0.4% lower, CAC 40 futures in France dropped 0.6% and the FTSE 100 futures contract in the U.K. fell 0.3%.
European stock markets closed higher on Thursday, rising for a fifth day, their longest advance since April. The Dax gained 2%, the CAC 40 ended up 1.2% and the FTSE 100 0.4% higher, lifted by the post-election rally in the U.S. and by fresh monetary stimulus from the Bank of England.
While the name of the next occupant of the White House is still undecided, Democrat Joe Biden has strengthened his hold on the presidential race, steadily chipping away at incumbent President Donald Trump’s early lead in a pair of crucial swing states.
Two of Trump's legal challenges to stop vote-counting were thrown out by state courts in Michigan and Georgia on Thursday, and his remaining actions have failed to have any impact so far. In his first public appearance since election night, Trump repeated unsubstantiated claims about voter fraud and vowed to continue the legal actions.
Investors are now looking at Biden beating Trump for the presidency but for Republicans to keep control of the Senate, allowing them to block Democratic plans for hefty infrastructure spending and corporate tax hikes.
“In short, Congress will in all likelihood remain divided for another two years,” said analysts at ING, in a research note. “This amounts to a major upset to hopes of substantial near term fiscal support.”
Meanwhile the coronavirus pandemic continues unchecked throughout most of Europe and the U.S. The European Central Bank was widely expected to announce more stimulus in December, .even before the BoE's move.
The major economic data release Friday comes from across the Atlantic, with October U.S. nonfarm payrolls data expected to show a further slowdown in the labor market recovery.
In corporate news, Allianz (DE:ALVG) is likely to be in the spotlight after the insurer giant posted a rise in net profit despite revenue falling in the third quarter. By contrast, Swiss luxury conglomerate Richemont (SIX:CFR)saw profits first sharply in the first half of its fiscal year as the pandemic hit sales.
Oil prices fell Friday, under pressure from signs of overproduction within OPEC and more aggressive discounting by Saudi Arabia in Asia.
U.S. crude futures traded 2.2% lower at $37.94 a barrel, while the international benchmark Brent contract fell 2.1% to $40.07. These contracts are still heading for their first weekly gain in four.
Elsewhere, gold futures fell 0.2% to $1,942.65/oz, but remained on course for its biggest weekly gain since July, while EUR/USD traded 0.1% higher at 1.1831.