Stock Market Update

The S&P 500 futures are up 156 points and trade 4.4% above fair value.

Equity indices in the Asia-Pacific region started the week with healthy gains. The rally efforts were attributed to reports that multiple news outlets declared Joe Biden the winner of the U.S. presidential race, providing some welcome closure for global equity markets and some hope that the U.S., under a Biden administration, will have a less protectionist trade bias. President Trump has yet to concede the race. Separately, China reported its best export growth in 19 months, although import activity was weaker than expected in October. Not surprisingly, the Summary of Opinions from the Bank of Japan's October meeting showed shared support for keeping the bank's easing measures in place to aid the economy.

• In economic data:
  • China's October exports +11.4% yr/yr (expected +9.3%; last +9.9%) and imports +4.7% yr/yr (expected +9.5%; last +13.2%)
  • Japan's November Reuters Tankan Index -13 (last -26); September Leading Index +4.4% (last +1.8%)

---Equity Markets---

• Japan's Nikkei: +2.1%
• Hong Kong's Hang Seng: +1.2%
• China's Shanghai Composite: +1.9%
• India's Sensex: +1.7%
• South Korea's Kospi: +1.3%
• Australia's ASX All Ordinaries: +1.9%

Major European indices are surging along with U.S. equity futures. Gains were already significant, as global markets reacted to reports that multiple news outlets had declared Joe Biden the winner of the presidential race, yet they went into overdrive following the news from Pfizer and BioNTech that their COVID vaccine candidate was more than 90% effective for people without evidence of prior infection. Separately, there is a Bloomberg report that suggests Germany might push the EU to hold off on imposing $4 billion of tariffs on U.S. goods in a bid to improve trade relations with a Biden administration. The UK, meanwhile, is said to be entering a critical week for Brexit negotiations with the EU, which still face big differences of opinion with respect to the issues of a level playing field and fisheries.

• In economic data:
  • Eurozone's November Sentix Investor Confidence -10.0 (expected -15.0; last -8.3)
  • Germany's September exports +2.3% m/m (expected 2.0%; last 2.9%) and imports -0.1% (expected 2.1%; last 5.8%)
  • Switzerland's October unemployment rate 3.3% (expected 3.4%; last 3.4%)

---Equity Markets---

• STOXX Europe 600: +4.8%
• Germany's DAX: +5.7%
• U.K.'s FTSE 100: +5.5%
• France's CAC 40: +7.4%
• Italy's FTSE MIB: +5.2%
• Spain's IBEX 35: +7.8%