November 7, 2020
By Lewis Krauskopf
NEW YORK (Reuters) – Markets will welcome the certainty after major networks declared Democrat Joe Biden winner of the U.S. presidential election on Saturday, offering some relief after days of the country getting conflicting reports about who might be in the White House next term.
News outlets and polling outlets including the Associated Press, NBC and Edison Research, upon which Reuters relies, called the presidency for Biden, leaving little doubt that he had won enough votes in the Electoral College to win.
However, Biden’s rival, current Republican President Donald Trump, has indicated that he will fight the results if he does not win, and his party has filed several lawsuits about vote counts. Reuters reported on Friday that the Republican National Committee is looking to raise at least $60 million to fund legal challenges brought by Trump over the election results.
Even if those battles are unsuccessful, investors also said ahead of the election that they were worried about the people Biden might appoint into his Cabinet, and whether the U.S. Senate would go to Republicans or Democrats.
A Republican Senate is also expected to be a check on Biden’s cabinet appointments, forcing him to opt for more moderate selections.
Whether his choices are seen as market-friendly is unclear. For example, investors will be closely watching Biden’s pick for secretary of the Treasury, who will likely be involved in any fiscal coronavirus relief to be negotiated with Congress, with markets fixated in recent weeks on the prospects of a stimulus package.
Biden has tapped former derivatives market regulator Gary Gensler to work on a transition plan for financial industry oversight, according to a person with direct knowledge of the matter.
Investors for months have worried that the worst-case scenario for markets would be if a contested result leads to uncertainty about the results dragging on for weeks, so if Trump gains any traction with his challenges, that could shake asset prices.
(Reporting by Lewis Krauskopf; Editing by Alden Bentley and Grant McCool)