Vaccine Optimism US Election Clarity Reduced Quarantine After Travel

European stocks are seen opening higher on Tuesday amid continued optimism surrounding covid vaccines and improving clarity over the political situation in the US as Trump clears the way for Joe Biden.

Three weeks after the US elections, Joe Biden received official acknowledgment that he effectively won the race to the White House. Trump liked the tweet, sending the message that he has come to terms with the election outcome even though he vows to keep fighting it.

The prospect of a disorderly transfer of power has dragged on the market for the past three weeks since the election; a line can now be drawn under this risk.

Vaccine optimism continues
The dominant driving force behind the market has been progress in vaccine development with AstraZeneca announcing yesterday that under a particularly dosage, it vaccine is 90% effective and can be stored at room temperature making it significantly easier to distribute than Moderna and Pfizer’s vaccine.

Germany’s GDP beat
Adding to the upbeat mood Germany’s final reading for Q3 GDP printed at 8.5% QoQ ahead of the 8.2% expected and an impressive recovery from Q2’s historic 9.7% contraction. However, following yesterday’s disappointing PMIs, which points to a double dip recession, the GDP figures seem out of date. More attention could be paid towards German IFO due to be released shortly.

Airlines soar as quarantine cut
Lockdown restrictions in Europe are still very much in place but there is talk of these easing which is offering support to sentiment. Aviation stocks, which have been one of the worst hit sectors across the crisis continue to post a strong recovery. News that the UK government is offering tests as a way to cut quarantine periods could give travel a boost over the Christmas period. IAG trades +4.4%

FTSE Chart

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.