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Biden and his higher-income tax hike take a stab at Wall Street


Wall street it has erased at a stroke the tranquility with which the session has opened and the main New York indices are left close to 1%. The red numbers come after it was learned that Biden is weighing a steep rise in capital gains tax for large fortunes.

US President Joe Biden is proposing to double the capital gains tax rate for wealthy Americans to 39.6%, Bloomberg reported Thursday. A news that the market has not liked.

This bearish turn comes after they closed very close to their all-time highs on Wednesday. The tranquility in the debt market, after a good auction of American 20-year bonds, motivated investors to enter the market and American equities approached record levels again.

"The 20-year bond auction was in high demand, pushing US 10- and 30-year yields modestly lower. That was enough to stimulate purchases."explains Jeffrey Halley, an analyst at Oanda. This expert adds that"bond yields are the ring that governs everything and continues to exert the invisible but powerful gravitational force on the markets".

In his view, until US yields rise once more, shopping on bag dips is the best tactic to generate returns on investors' portfolios.

The tranquility with which the main New York indices were moving was completely expected by the experts. "It's natural to expect markets to take a breather after hitting a series of all-time highs earlier in the month. After all, technical indicators had been highlighting overbought conditions lately, "said Han Tan, market analyst at FXTM.

In the business results chapter, the telecommunications operator AT&T has presented its results, which show a gain of 63.8% compared to the same period last year, while the airline American Airlines It will do it during the day; and Intel Y Snap They will do so after the market closes.

On the other hand, Blackstone has also released its accounts for the first quarter of 2021, with losses of 2,167 million.

On the economic agenda, the weekly unemployment data. Contrary to the estimates of analysts, who spoke of a slight rebound. The Labor Department has notified 547,000 unemployment claims compared to the 603,000 estimated by the market. In the previous week they stood at 586,000.

Despite the fact that the United States still has a long way to go, employment is slowly recovering and is getting closer to pre-pandemic levels. The Oxford Economics Experts they expect to achieve these levels by mid-2022.

At the geopolitical level, the climate summit called by Joe Biden in the US and attended (virtually) by the president of China, Xi Jinping; and that of Russia, Vladimir Putin.

The American president has promised that net greenhouse gas emissions in the country are reduced by between 50% and 52% by 2030, taking into account the 2005 levels.

And in monetary policy, the European Central Bank (ECB) you will keep your asset purchase program unchanged. The president of the organization, Christine Lagarde, has assured that "the medium-term risks are more balanced. The advance of vaccines is encouraging, but the pandemic, including the new variants of Covid is worrying."

In other markets, oil West texas falls 0.5% to $ 61.03, while the euro it trades flat and changes to $ 1.2023. In addition, the profitability of the 10-year American bond drops to 1.56% and the ounce of gold down 0.4% to $ 1,786. Finally, the bitcoin down 3% to $ 53,980.

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