- US 10-year Treasury yields marked the heaviest bear move since March on Wednesday, stays depressed afterward.
- Republicans look set to keep the Senate’s controls even if Biden leads the race to the US presidency.
- Fed meeting, US election updates will be the key.
US 10-year Treasury yields drop 2.8 basis points (bps) to 0.74% during the pre-European session on Thursday. The risk barometer earlier dropped to the lowest level since October 17 after portraying a stellar downturn the previous day.
Although Joe Biden’s recent victory eased his path to the White House, US President Donald Trump tries best to keep the reins of the Senate. In doing so, the Republican leader challenges voting results from Wisconsin while also holding bars for the ballot counting in Pennsylvania. That said, Biden has nearly 265 votes in his pocket, versus 270 needed while Trump holds only 214 counts.
Check: US election wrap: It ain’t over until … the Trump concedes defeat
Not only the fears that the absence of the blue wave, a situation where Democrats hold the power in both the US houses, restricts American stimulus, but the coronavirus (COVID-19) headlines also weigh on the market sentiment. Further, traders’ caution ahead of the monetary policy meeting by the Bank of England (BOE) and the US Federal Reserve (Fed) also sober the mood.
Talking about the virus, Italy announces lockdown for Lombardy, including the national capital Milan, whereas China bans UK nationals citing the move to tame the COVID-19 resurgence at home.
Moving on, the BOE is widely anticipated to announce a rate cut towards the controversial negative rate area. UK Chancellor Rishi Sunak is also to combat the fears of Britain’s double-dip recession due to the second national lockdown.
Read: Bank of England Preview: Lockdown raises chances of negative rates, streling could suffer
On the other hand, the US Federal Reserve isn’t likely to alter the current monetary policy but will keep resisting the bullish words considering the latest downbeat economics.
Follow: Fed Preview: Powell set to see glass half full, unless he has depressing NFP data
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