Art of rally if everything seems under control

вЂњNow as BidenвЂ™s Treasury secretary, she will continue to wave her magic wand,вЂќ he argues.

That raises the prospect of co-ordinated and aggressive fiscal-monetary policymaking to combat the economic damage wreaked by Covid-19, further delighting investors.Д®d Yardeni of Yardeni Research referred to Ms Yellen as the вЂњFairy Godmother of the Bull MarketвЂќ when she was chair of the central bank in 2014-18, due to her dovish views, and reckons her re-emergence as an influential policymaker is another positive sign for equities. And to cap it off, last week it emerged that Mr Biden would name former Federal Reserve chair Janet Yellen as his Treasury secretary. Reports of corporate profits rebounding have reinforced the optimism. This provided an enormous jolt to global markets, which could contemplate a gradual economic normalisation next year, with pent-up demand and super-easy monetary policy fuelling a huge growth spurt. Then, BioNTech-Pfizer, Moderna and Oxford university-AstraZeneca announced that they had developed coronavirus vaccines that were in most cases more effective than expected. That President Donald TrumpвЂ™s refusal to accept the result has failed to trigger any significant unrest has added to investorsвЂ™ relief. вЂњGridlock is Goldilocks,вЂќ was the pithy title of one Wall Street analystвЂ™s note on the subject. While another big dose of fiscal stimulus may be trickier to pass, this will mean that the Federal Reserve is more likely to keep its foot on the monetary pedal. For many investors that was close to the perfect result, ejecting the erratic, norm-shattering Donald Trump but stymieing the more radical parts of the Democratic agenda - such as heavy corporate tax increases. First, Joe Biden won the US presidency but Democrats failed to gain control of the Senate. The impact of ultra-easy monetary policy including very low interest rates - and the prospect of it continuing for years to come - remains the dominant driver, analysts say.Д«ut NovemberвЂ™s shift from optimism to near-euphoria has been triggered by an alignment of several stars. The early stage of the rally was powered by mammoth fiscal and monetary stimulus packages from central banks and governments around the world, totalling trillions of dollars. Joe Biden promises stability as president while a split Congress should blunt the Democratic partyвЂ™s left В© Mark Makela/Getty

Art of rally if everything seems under control