Breaking News
0
Ad-Free Version. Subscribe now to follow markets, faster and distraction-free. More details

Biden Stimulus Announcement, Powell Speech, Jobless Claims - What's up in Markets

EconomyJan 14, 2021 12:35
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

By Geoffrey Smith 

Investing.com -- President-elect Joe Biden will present details of his plans to support the economy through the pandemic, while Federal Reserve chairman Jerome Powell may offer some reaction in a speech later. Weekly jobless claims are expected to rise slightly. Germany’s economy shrank by less than feared in 2019 and China’s trade surplus ends the Trump presidency at a record high. The House voted for the second time to impeach Trump on Tuesday but there’ll be no trial in the Senate any time soon. OPEC releases its monthly report on the oil market. Here’s what you need to know in financial markets on Thursday, January 14th.

1. Biden to detail stimulus plans; Powell speaks later

President-elect Joe Biden will announce details of his plans for extra stimulus to support the economy through the pandemic.  Biden has promised a sticker price “in the trillions of dollars”, a number that has supported equities and other risk assets for the last week.

According to various reports, the proposal is expected to contain a boost to the recently authorized $600 direct payments to most Americans, an extension of increased unemployment insurance and support for state and local governments. Hints that Biden will aim for bipartisan support imply that some elements of the plan may be trimmed to appease Republican lawmakers.

An increase to stimulus plans will imply higher federal borrowing and keep the onus on the Federal Reserve to step up as the biggest buyer of the new bonds. Fed Chairman Jerome Powell is due to speak at 12:30 PM ET.

2. Jobless claims due, German GDP shrinks 5%, Chinese trade surplus record

Biden’s announcement will come after what’s likely to be fresh evidence of a further weakening in the labor market due to the pandemic.

Weekly data at 8:30 AM ET (1330 GMT) are expected to show an increase to 795,000 in initial jobless claims.

Overnight, data from Destatis showed Germany’s economy shrank by a little less than expected last year, although it was still the biggest contraction since World War 2. Gross domestic product fell 5.0% from 2019, better than the 5.2% expected.  Recent German data have all tended to be revised upward, so the final outcome for Europe’s largest economy may be better than the one reported today.

Elsewhere overnight, China’s final trade numbers of the Trump presidency gave no indication that four years of trade wars had had any impact on it at all. Exports were up 18% on the year, while the country’s trade surplus hit an all-time high of $78.2 billion.

3 Stocks flat; Tesla recall, Blackrock (NYSE:BLK)'s earnings eyed

U.S. stock markets are indicated to open slightly higher, but are likely to stay in modest ranges pending Biden’s announcement (and any reaction from Fed Chairman Powell).

Overnight, U.S. 10-year Treasury yields ticked up to 1.11%, with 1.10% pivoting to be the new support level rather than a resistance level.

By 6:30 AM, Dow Jones futures were up 60 points, or 0.2%, while S&P 500 futures were flat and NASDAQ Futures were down 0.3%.

Stocks likely to be in focus later include Tesla (NASDAQ:TSLA), which is being urged by regulators to make what would be one of its biggest safety recalls ever. Asset manager Blackrock and Delta Air Lines (NYSE:DAL) are both due to report fourth-quarter earnings.

4. Trump impeached, again; no trial before inauguration

The House of Representatives voted for a second time to impeach President Donald Trump (who now accounts for half of all impeachment votes since the constitution was drawn up).

Ten Republican lawmaker voted for the motion, while another four abstained. The vast majority of GOP lawmakers opposed, underlining the hold that Trump’s electoral base still has on the party.

Outgoing Senate Majority Leader Mitch McConnell said that Trump will not be put on trial by the upper chamber until after the inauguration of Joe Biden.

5. Opec monthly report due; crude consolidates

The Organization of Petroleum Exporting Countries will release its monthly report on the outlook for the global crude oil market at around 7:20 AM ET, according to newswire reports.

The report will carry OPEC’s first assessment of demand trends for this year since Saudi Arabia’s surprise decision last week to cut output unilaterally by 1 million barrels a day for the next two months.

Crude prices have hit a succession of post-pandemic highs since then, helped by two reports this week showing a sharp drop in U.S. crude inventories, and were consolidating near those highs overnight. U.S. crude futures were down 0.1% at $52.84 a barrel, while Brent crude futures were down 0.3% at $55.91 a barrel.

Biden Stimulus Announcement, Powell Speech, Jobless Claims - What's up in Markets
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email