[ad_1]
In the wake of news of the US economic stimulus package, global equity markets rebounded for a fourth day on Tuesday to achieve continued gains in trading.
US President Donald Trump’s signing of the Economic Aid Bill was a dose of hope for the global economy as stock indexes were colored green, causing the oil market to follow the markets on their upward path.
On Sunday, Trump signed the Economic Aid Bill and the Government Funding Bill, and called for the removal of unnecessary financial allocations.
The value of the aid program to counter the economic effects of the Corona pandemic is $ 900 billion.
The package includes direct assistance to families and individuals, in an amount that has not yet been decided whether it is $ 600 or $ 2,000, and also includes billions of dollars in small business loans, and a funding to facilitate the distribution of Covid-19 vaccines, and it also extends the ban that suspends evictions until January 31. Rented.
Financial markets await Senate approval of the economic stimulus package amendments, in a way that will boost the U.S. economy by about $ 2.3 trillion, including $ 900 billion to help mitigate the impact of the pandemic on Americans, and 1.4 trillion is allocated to spending to fund government agencies.
Save numbers in green
The signing of the economic stimulus plan led to the improvement of stock indices in the United States, Europe and Asia, all of which are colored green, according to Reuters.
The MSCI Global Index, which measures financial market indicators in 23 countries, including developed and emerging markets, rose 0.03%, with the start of trading on Tuesday, which came with index support. Japanese stockbroker who reached its highest level in 30 years.
On Tuesday, US equity futures rose to gain Wall Street with its 0.5% opening, while oil prices for Brent and West Texas futures rose 1.2%.
The Dow Jones index set an all-time high by crossing the barrier of 30,408 points, while the Nasdaq index crossed the barrier of 12,800 points to reach its highest level, as did the Standard & Poor’s index at 3,740. points.
Blue-chip stocks dominated financial markets in Europe, which responded to the US economic stimulus package and positive news about a trade deal between Britain and the European Union. The FTSE 100 index, which includes stocks of UK companies, rose more than 2%, led by energy and pharmaceutical stocks. .
The American economy
Over the past few days, concerns about the global economic recovery have emerged, especially with news of the novel strain of coronavirus, which has eclipsed the news of the discussions taking place in Congress over the economic stimulus package, and even marginalized positive news regarding Corona virus vaccination campaigns.
And count on this package to revitalize the economy and restore to certain sectors their capacity to work and to find a job.
Who are the experts who are fighting?
CFI Group financial analyst Muhannad Erekat said in response to requests from the Al-Hurra site that US stocks were among the most important where the impact of the package was indirectly reflected, as the signing of the package by Trump was enough to cause a wave of gains to be recorded. Some indicators have not been recorded before.
He suggested that in the coming days, we would see a continuation of the upward wave, especially as the stimulus package will prevent the US economy from going badly in 2021, especially when it comes to unemployment.
David Kelly, chief analyst at JP Morgan, said in his latest weekly forecast that the stimulus package is a big boost in hope, bringing some relief to the US economy, which is slowing due to the Corona waves and the number high injury and death.
He stressed that the effect of the stimulus package will be short-lived, which necessitates re-examining the approval of the stimulus package.
Steve Cochrane, chief analyst at Moody’s, said the economic stimulus package has come at an opportune time for the US economy, which will support its growth, especially in light of rising unemployment rates and declining sales.
The economic stimulus package is expected to contribute around 1.5 percentage points to annual GDP growth, which will appear in data for the first quarter of 2021.
William J. Gill and Grace Enda said in a study published by the Brookings Institute for Research that it is not possible to recover the economy until you control the Corona pandemic, but economic stimulus packages are important for deal with the crisis created by Corona.
They added that despite the expectation of a worsening long-term budget deficit from current solutions, they are important to the economy and should not be treated in a timid manner, which requires intervention to mitigate the economic damage to them. United States and Americans in the long run.
According to a report released by the investment platform, Think Advisor, the back-up plans will reflect on the US economy at several levels that will directly affect individuals with certain income levels, which has yet to be resolved. by cash checks in the amount of $ 600 or $ 2,000 per person.
The package will help about 14 million Americans by paying unemployment and unemployment benefits, which amount to $ 300 for 11 weeks, in addition to various unemployment aids.
About $ 300 billion will be allocated to personal loans, especially education loans.
In addition to extending the moratorium on housing evictions until the end of January 2021, for which around $ 25 billion has been allocated in rent assistance.
Small and medium-sized businesses will have a share of this package, as they will receive specific loans and tax breaks, and businesses that work in partnership with the public sector will be able to obtain loans and allow them to deduct business expenses from these loans.
The number of claims for unemployment benefits related to the pandemic increased by 139,000 in the week ending December 5.
International economy
So far, the impact of the signing of the US economic stimulus plan has been evident on the global economy, with money markets recovering and indicators improving.
The US economy is considered to be at the forefront of the most powerful countries in the economy and it has a direct impact on the global economy. Improving US metrics always means improving various international metrics, according to financial analyst Erekat told the Al-Hurra website.
He added that stimulating economic growth in the United States is closely linked to restoring confidence in financial markets and investors returning to reinsurance and investment, which means removing doubts and uncertainty. that dominates the global economy because everyone is waiting to find out what is happening due to the Corona pandemic.
Stephen Innes, chief analyst at Axi Group, told Reuters that with Britain’s exit from the European Union, and what followed, “the US economic stimulus package has spared us the worst-case scenarios.” that could happen.
The director of the International Monetary Fund, Kristalina Georgieva, said in statements she made in October and November that the United States approves a new stimulus package for the U.S. economy, which would help reduce uncertainties over the Mondial economy.
She pointed out that stimulus spending of around $ 3 billion in the United States at the start of 2020 “was a significant positive stimulus, and we want to see how that continues,” according to Reuters.
In an interview with CNBC, Georgieva confirmed that the effect of the much needed stimulus package will be positive when passed, and that it “will bring improved certainty, and certainty is what we need to do. in the light of this crisis. “
She added that there is still a way to deal with this crisis, so there will need to be space for financial support, saying the United States has that fiscal space.
The suspension of the economic wheel caused by the health crisis and the wave of state closures have led to a severe economic recession since the first quarter of 2020.
The International Monetary Fund expects gross domestic product to decline by 4.4%.
Source link
