Global equities mixed ahead of Biden’s inauguration
January 19 2021 09:35 PM
Pedestrians pass the London Stock Exchange in the square mile financial district of the City of Lond
Pedestrians pass the London Stock Exchange in the square mile financial district of the City of London. The FTSE 100 closed 0.1% down at 6,712.95 points yesterday.

AFP, Reuters London

European stock markets were softer yesterday after a strong showing in Asia, as investors reacted to comments by US Treasury secretary nominee Janet Yellen, and Covid-19 developments.
In New York, meanwhile, the Dow Jones index was higher in midday trading, with upbeat US corporate earnings helping to boost the mood.
The dollar was mixed on the eve of Joe Biden’s inauguration as US president, with traders focused on his vast $1.9tn stimulus plan.
Oil prices gained on optimism over the global economic recovery and vaccine rollouts that are offsetting concerns about the emergence of new, apparently more contagious strains of the novel coronavirus.
The key event this week is Biden’s inauguration today, with the Democrat vowing swift action to fight pandemic fallout and boost the ailing US economy.
In the meantime, investors tuned in to hear Yellen tell US lawmakers that the world’s top economy could suffer if they do not approve his stimulus package.
She also emphasised that the dollar’s value should be determined by foreign exchange markets, and expressed support for global digital tax negotiations taking place under the auspices of the Organisation for Economic Co-operation and Development (OECD). A global agreement would allow the US to collect taxes from corporations that have moved their headquarters overseas, Yellen told the Senate Finance Committee during her confirmation hearing.
“It would enable us to collect a fair share from corporations, while maintaining the competitiveness of our businesses and diminish the incentives that American companies now have to offshore activities,” she said.
In New York, traders also scoured US corporate results, which Oanda market analyst Craig Erlam suggested might “spark markets back into life”.
In Germany meanwhile, investor confidence jumped in December, the ZEW institute’s monthly barometer showed.
ZEW President Achim Wambach said: “The announcement of imminent vaccine approvals makes financial market experts more confident about the future,” but that failed to push the DAX index of leading German shares into the black.
That was because German authorities were set to announce the extension and tightening of a partial lockdown beyond January owing to growing fears over the new coronavirus variants.
London’s FTSE 100 closed 0.1% down at 6,712.95 points, Frankfurt’s DAX 30 ended 0.2% down at 13,815.06 points and Paris’ CAC 40 finished 0.3% down at 5,598.61 points.
After gaining almost half a percent at the open, the pan-European STOXX 600 index inched lower as the session wore on and closed down 0.2%. 
Among the companies that reported quarterly results, Switzerland’s Logitech fell 6.4% after hitting an all-time high earlier in the wake of raising its 2021 sales growth and profit outlook.
Miner Rio Tinto slipped despite reporting a 2.4% rise in fourth-quarter iron ore shipments, helped by industrial activity in top consumer China.
As European earnings gather pace, analysts are predicting a 26.2% decline in fourth-quarter profit for companies listed on the STOXX 600, as per Refinitiv IBES data.
However, the main worry for investors is that an expected 43.5% and 81.1% rebound in first and second quarter earnings could be called into question as the European economy reels from the impact of stringent Covid-19 lockdowns.
“Going in to the Q4 earnings season investors are more likely to be concerned with the outlook than historic performance given that the situation with the virus is changing so quickly,” said Edward Stanford, head of European equity strategy at HSBC.
“With the prospects for economic growth potentially coming under pressure, we see a little bit of downward pressure on consensus earnings for Europe for 2021.”
Danone rose 2.7% after an activist investor called on the French food group’s chief executive to step down after it took a stake in the company late last year.
Weighing on the FTSE 100, Ladbrokes owner Entain tumbled 11.9% after US casino operator MGM Resorts ditched plans to buy the British company after it rejected an $11bn takeover approach this month.

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