Oil resumed its recovery, still bolstered by the expectation that OPEC+ would increase its production reduction steps beyond January 1. On Nymex, the December contracts for U.S. light crude (WTI) jumped 4 percent on Wednesday to $39.15, while the January delivery contract for Brent rise 3.8 percent to $41.23. The announcement of a sharp decline in oil stock in the United States last week, by 8 million barrels, also helped the rise.
After three days of recovery, Gold plunged again, slipping below $1,900 per ounce to the Comex’s $1,896.20 (-0.70 percent) for December futures contract.
The currency market was calmer than other financial centers. The dollar index (measuring its development against a basket of six currencies) fell 0.1% to 93.45 points, while the euro peaked at $1,1719 after a drop of -0.07%.
Despite the increase in stock markets, on Wednesday, investors also rushed to government bonds, sending interest rates back on. The 10-year T-Bond yield fell 13 basis points to 0.77%. Investor sentiment represents the fear of a prolonged period of political uncertainty in the United States in the event of the results of the presidential election being called into question.
With likely outgoing Republican President Donald Trump and his Democratic challenger Joe Biden in a pocket handkerchief in some crucial states, where the postal vote count is not yet complete, the outcome of the presidential elections remains unclear. Democrats are expected to maintain their majority in the House of Representatives in Congress, while Republicans are expected to retain their narrow lead in the Senate (of which 35 were renewed on Tuesday out of 100 seats).
Regardless of the president, Wall Street is reassured by the possibility of a split Congress, which, if Joe Biden wins, reduces the chance of overly bold changes, including strengthening social security coverage, curbing drug costs, increasing corporate taxes, and taxing capital gains and other revenue.