What does the US Capitol breach mean for markets?
Scenes of supporters of U.S. President Donald Trump storming the Capitol building to undo Trump’s election loss shocked the world on Wednesday, but most investors have so far viewed the unrest as a short-term event that is unlikely to have a lasting impact on asset prices.
Money managers have focused on the potential for more government spending thanks to the Democratic sweep of the runoff vote in Georgia. The result has helped Wall Street Indexes hit new records. More fiscal support forthcoming likely means a stronger economic recovery and markets are pricing that in.
Even the usual barometers for caution finished lower, with prices for gold, and the CBOE Volatility Index, also known as Wall Street’s fear gauge, both ending the day lower.
Stocks of companies that would profit from increased spending on infrastructure were helping to lead the market.
While analysts caution about the potential for market moves if the situation worsens, so far investors are taking it in their stride. Markets are assuming the events will subside and will not lead to anything further.