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* Futures: 1.15% in Nasdaq, 0.14% in S&P, 0.29% fall in Dow
January 6 (Reuters) – Futures tracking the Nasdaq 100 index fell more than 1% on Wednesday as the price for investors likely to win both races in a Senate run-off election in Georgia, Washington Will determine the balance of power.
Edison Research called one of the incumbent Kelly Loeffler in the race for Democratic Rafael Warnock, while Democratic challenger John Ossoff took a slim lead over Republican David Perdue with 98% of the vote.
A Democrat-controlled Senate would give more scope for President-Elect Joe Biden to act on his reform plans, including new COVID-19 incentives, but it could also mean high corporate taxes and strict on the technology mega-cap Rules – Policies are generally favored by Wall Street.
OCBC Bank, executive director of investment strategy, Vasu Menon, said “Blue Wave ‘may not be a bad outcome for markets as decisive fiscal action will help accelerate economic recovery.”
“This will be increasingly for risk assets, especially equities, credit, commodities and emerging market securities.”
As of 2:06 pm ET, the Dow e-minis was up 89 points or 0.29%. Constituents of blue-chip Dow are generally expected to benefit from a pick in economic activity.
The S&P 500 E-Minus was down 5.25 points or 0.14%, and the Nasdaq 100 E-Minis was down 147 points or 1.15%.
Hopes of a vaccine-driven economic recovery in 2021 had driven Wall Street’s main index to record highs in late December, but sentiment was tempered by recent discoveries of a more contagious version of coronovirus and the latest sanctions is.
Analysts expect the market to consolidate December gains in January as asset managers rebalance their portfolios that were heavily skewed towards equities. (Reporting by Sagarika Jaisinghani in Bengaluru; Additional reporting by Scott Murdoch in Hong Kong; Editing by Sriraj Kuduvila)