European stocks keep rising with an eye on the US elections

November 03, 2020 13:30

European stocks keep rising with an eye on the US elections

The main European indices have started the month of November strongly after closing the month of October as one to forget, in which they saw strong drops following the new restrictions to battle the Covid-19 pandemic.

Here's how they have fared in the first hours of trading:

  • The German DAX 30 registered increases of more than 2%
  • The French CAC 40 registered increases of more than 2%
  • The Italian FTSE MIB registered increases of more than 2%

These rises are in line with yesterday's increases. The British FTSE 100 and the Spanish IBEX 35 rose at the same time with slightly less intensity, around 1.6%.

The uncertainty surrounding the economic recovery due to the rise in the rate of coronavirus infections seems to be in the background this week and now the attention is focused almost exclusively on election day today in the United States, in which it will be decided whether Donald Trump will remain for another four years in the White House or if, on the contrary, Democrat Joe Biden will take his place.

On the other side of the Atlantic, Wall Street futures are maintaining their gains from yesterday, above 1%. Peace of mind also seems to be reigning in the United States on this election day, as the VIX index has fallen below 35 points after registering a five-month high last week, at around 40 points.

The psychological threshold of 40 points has only been passed 6 times, in moments of panic such as after the 9/11 attacks and after the outbreak of the financial crisis. The last time was in March 2020, when the Covid-19 pandemic was declared.

VIX Index Futures CFDSource: Admiral Markets MetaTrader 5. VIX Index Futures CFD Chart. Data range: from February 19, 2020, to November 3, 2020. Prepared on November 3, 2020, at 11:20 CET. Keep in mind that past returns do not guarantee future returns.

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