The Democratic Senate also accepts, but the US stock market overseas stock lounge is thrilled | Hankyung.com

If the Democratic Party wins the US Senate runoff vote in Georgia, the stock market could fall by as much as 10%, said US asset management firm Oppenheimer. The Georgia final ballot will be held on the 5th (local time).

According to CNBC, Oppenheimer’s chief investment strategist John Stoltzpurs said in an investment memo sent to clients on the 4th. I expected it to be adjusted.

Meanwhile, the mayor has predicted that the Republican Party will be able to win at least one seat in Georgia, and that forecast is reflected in the stock price, Oppenheimer explained. He pointed out that if the Democratic Party wins a full victory in the Georgia state runoff, it will be able to control the Senate, which is disadvantageous to businesses due to the increased possibility of a corporate tax increase. Oppenheimer said the mayor prefers the Democratic and Republican parties to share power.

Currently, the Senate consists of 50 Republicans and 48 Democrats out of a total of 100 seats. The Republican Party will remain in the Senate Majority status if it wins at least one of the two seats in the Georgia runoff. However, if all two seats are given, the number of seats from both parties will be 50-50, and the Democratic Party will take the lead. This is because the vice president who is the chairman of the Senate holds the casting boat.

The Democratic Party also won the House election on November 3 last year. If you take all of the two seats in the Georgia final ballot, you will take control of the Senate. In this way, President-elect Joe Biden’s commitment to corporate tax increase and higher income tax increase could be gained momentum. This is why the prospect of the Democratic Party’s victory in the Georgia runoff on Wall Street will lead to a decline in stock prices.

In fact, on the 4th, this anxiety spread and the US stock market plummeted. The Dow index closed down 382 points (1.25%). At one time during the day, it plunged 724 points. The S&P 500 index and the Nasudak index also fell by 1.5 percentage points respectively. CNBC said, “Concerns over the state’s runoff vote have fueled a sharp sell-off in the New Year’s stock market.”

Currently, the democratic party is showing superiority in the opinion polls. According to the average of the polls compiled by the political analysis company’Real Clear Polytics’ on the 2nd, Democratic candidates are slightly ahead of the Republican candidates within the margin of error. As of 5:30 pm on the 4th, there is no change in this number.

The fact that if the Democratic Party dominates the Senate after the White House and the House of Representatives, a high-strength stimulus package could come out, it could be a boon to the stock market. The Democratic Party initially pushed for a $2.2 trillion stimulus package to reduce the corona shock, but agreed to reduce the size of the stimulus to $900 billion in negotiations with the Republican Party, which held on to $500 billion. Biden-elect has already defined the $900 billion stimulus plan as a “starting fee,” and announced his intention to pursue additional stimulus measures after taking office on the 20th.

Oppenheimer also raised the possibility that the Georgia election results will not be confirmed immediately. He pointed out that this would lead to worse outcomes for the stock price in the short term.

Washington = Correspondent Ju Yong-seok [email protected]

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