The only conclusion that can be drawn from yesterday's long-awaited first election debate between Trump and Biden is that of total chaos.
An atypical discussion in which the contenders did not point to any specific measure of social or economic policy, nor did they draw clear lines of foreign policy as has been the case in the preceding debates, but rather it was a bitter confrontation with personal accusations and disqualifications of all kinds.
This type of beginning of the electoral campaign leads us towards uncertainty in the markets, even more than what is already being suffered due to the pandemic and which will cause higher levels of volatility in the financial markets with a low level of risk appetite.
The possibility of an imminent agreement on the fiscal stimulus package long-awaited by the market diminishes notably in the face of the evident and rude climate of confrontation.
All of this is reflected in the behavior of financial assets with the stock indices, both European and North American, down, and without hope of a prompt resumption of the upward momentum.
On the side of the economic figures, it only remains to wait for the publication of the Non-Farm Payroll on Friday, which is particularly relevant given that the Federal Reserve decided to focus its objective of monetary policy on the recovery of the employment level. Only good job creation data and a drop in the unemployment rate could alleviate the negative feeling of risk that currently dominates the market. 850k expected in non-farm payroll and 8.2% unemployment rate
Global Equities
Meanwhile, the futures of the North American indices have returned to the red with losses in TECH100 of around 0.50%, an index that is losing bullish moment and fails to overcome the resistance zone located around 11,500.
The US Dollar, as indicated in yesterday's analysis, has strengthened against all currencies in a typical "fly to quality" movement due to its nature as a safe-haven currency.
Paradoxically, the enormous uncertainty about the future of US policy has the effect of strengthening its currency.
In the case of GBP/USD, the pair has not managed to overcome the 1.2900 level due to the double effect of a stronger Dollar due to flows in search of safe havens and the lack of expectation of a Brexit agreement whose deadline of 15 October is getting closer.
The support level at 1.2700 needs to be drilled for the pair to head towards more profound losses to the 1.2510 area.