Get out your Surfboard – The Georgia senate election had been on everyone’s calendar since November and it now appears markets will get a Blue Wave after all. Exactly how much can be done remains the question, but the rotation occurring today is a hint as to where investors see the opportunity. Rate sensitive financials (yields moving higher) are the day’s best performers. JPM (+5.5%), BofA (+7.6%) and Wells Fargo (+7.6%) are just some of the highlights, and the performance is putting them on the Redburn 3 month relative high list. Metals and Miners are also getting a boost (infrastructure spend) from US Steel (+18%) and Century Aluminum (+17%), while Industrials (+3%) benefits from Caterpillar (+6%) and Deere (+6.5%). Even the Nasdaq 100 (-11bps), which was down 1.6% at the open due to its mega tech exposure (FANG -1.3%), has been pulled up by the broader outperformance from semi’s, retailers and leisure cos. While there are still two hours of trade left, the S&P and Russell are in ATH territory, with Value ETFs outperforming Growth by 2.3%.
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