Monday, October 3, 2022

European Stocks Rise, Wall Street Futures Point to Gains as Investors Digest German Election Outcomes

European stocks rose and Wall Street futures pointed to early gains as investors digested the election results in Germany, with clear relief that the far-left Linke Party failed to garner enough votes to enter parliament. and therefore promoted the possibility of a more centrist. ruling coalition.

Germany’s blue-chip DAX was up 137.10 points, or 0.88 percent, as of 4:32 a.m. New York time on September 27, while the pan-European STOXX 600 index was up 1.26 points, or 0.28 percent, in early trade.

Elsewhere in Europe, Britain’s FTSE 100 was up 20.57 points, or 0.29 percent, as of 4:35 a.m. New York time, while the French CAC 40 was up 40.53 points, or 0.61 percent.

In US-focused markets, Nasdaq futures were down 25.75 points, or 0.17 percent, S&P 500 futures were up 9.25 points, or 0.21 percent, and Dow Jones futures were up 133.00 points, or 0.38 percent, as of 5:38 a.m. New York time.

Germany is facing months of challenging negotiations to form a coalition government after Sunday’s federal election, which requires the three parties to team up to clear a threshold of 50 percent of all seats in parliament.

Olaf Scholz’s centre-left Social Democrats will seek to form a coalition with the Greens and the Liberal Free Democrats (FDP), dubbed the “Traffic Light” coalition. At the same time, Christian Democrat candidate Armin Lashet plans to try to form a government with the FDP and the Greens, known as the “Jamaica” coalition, named after the black, yellow and green colors of that country’s flag. has been kept for.

“Both the Jamaica and traffic light options would create continuity from the current government in terms of fiscal and EU policies. The traffic light coalition would be easier on both, but the difference from the current government would be minor. Therefore, apart from a shift in a greener direction, the election The prospect of broadening indicates continuation,” JPMorgan economist Greg Fujissi told Reuters.

Market moves on Monday morning painted a picture of relief to investors that the hard-left Link party failed to garner more votes than the 5 percent threshold needed to enter parliament.

Holger Schmeeding, chief economist at Berenberg Bank, said in a research note that a coalition comprising Linke, the Social Democrats and the Greens “could influence trend growth through tax hikes, reform reversals and excessive regulations.”

Provisional results indicated that the Social Democrats won 25.7 percent of the vote, ahead of 24.1 percent for the conservative bloc that includes Christian Democrats. The Greens gained 14.8 percent and the FDP 11.5 percent.

Reuters contributed to this report.

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Tom Ozimek has an extensive background in journalism, deposit insurance, marketing and communications, and adult education. The best writing advice he’s heard from Roy Peter Clark: ‘Hit your goal’ and ‘Leave the best for last.’

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This News Originally From – The Epoch Times

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