November 06, 2020: Most Asian markets were mixed Friday after the week's strong gains but traders remained upbeat as the chances of Joe Biden winning the US election increased and after the Federal Reserve indicated it could provide further economic support.

While Donald Trump again accused Democrats of committing voter fraud and his team launched a series of legal actions in various states, hopes a new stimulus package will eventually be passed were supporting sentiment.

Analysts said Tuesday's election was good for equities as the expected Democratic sweep of Congress failed to materialize while Biden looked set to take the White House.

“The market reaction to the unfolding election news suggests that financial markets would prefer to see a constrained Biden presidency,” Paul O'Connor, at Janus Henderson Investors, said.

However, he added: “The economic backdrop to this election is one of an incomplete global recovery that remains threatened by the continued spread of Covid-19 in many major economies as well as fast-fading fiscal support measures.”

A Biden presidency and Republican Senate likely means Democrats will not be able to push ahead with regulatory changes and tax hikes, which observers said were both good for stocks.

Tech firms have fared particularly well as the sector had been considered vulnerable to more stringent political oversight.

And while lawmakers are expected to push through a new economic rescue package, it will not likely be as big as anything from a Democratic-led Congress, which National Australia Bank analysts said would put the onus on the Federal Reserve next year.

And the US central bank provided some cheer to traders after its latest policy meeting Thursday as it pledged to do all it could to support the world's top economy.

Boss Jerome Powell said more stimulus was “absolutely essential” to support the economy as the outlook was “extraordinarily uncertain” but that other tools were available to the Fed.

“We can certainly look at new facilities” if the situation deteriorates, he told a news conference.

AFP/APP

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