Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Election 2020: Key Outstanding States To Watch And What The Market Reaction Means

By Matthew WellerForexNov 05, 2020 12:07AM ET
Election 2020: Key Outstanding States To Watch And What The Market Reaction Means
By Matthew Weller   |  Nov 05, 2020 12:07AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

As we noted in our Election Night Live Blog, we were never likely to get a clear answer on who won the US Presidential Election right after the polls closed, but the results have proven even tighter than forecast as we await final counts on a few more key swing states. Regardless of the final result, it’s clear that the United States is anything but united, and whoever is ultimately declared the winner will have a difficult time bringing together a deeply divided nation.

Key outstanding states to watch:

North Carolina is likely to go to Trump, even if it hasn’t been made official yet. The President has 50% of the vote (vs. 49% for Biden) with just 5% left outstanding, but the outstanding votes are from more liberal areas of the state and votes can be accepted until 12 November, so we may not get a clear answer from the Tarheel State this week.

Georgia was perhaps yesterday’s biggest surprise, with the long-time Red state seeing a late break comeback by the Democrats. As it stands, Trump still leads 50.5%-48.3%, but the majority of the outstanding vote is from the liberal Atlanta suburbs, so Biden conceivably has a path to pull out a narrow victory. These votes may take a day or two to fully tally, but a press conference is expected later this morning so we may still yet get a result today.

Arizona has already been declared for Biden by some networks (AP and FOX), though others are exercising an abundance of caution. Biden will need to secure this state to have a “Plan B” if Pennsylvania (see below) goes for Trump.

Nevada has unexpectedly become a key state. Biden leads 49.3% to 48.7% over Trump with 87% of the vote counted, but no more results are expected until Thursday.

Pennsylvania, the biggest prize of the whole election, remains the most up-in-the-air race. The President technically leads by nearly 10 points as of writing, but the outstanding vote is likely to be overwhelmingly Democratic, so this one will almost certainly go down to the wire. We’re likely to be watching the results trickle in from the Keystone State for the rest of the week.

Taking a step back, the best chance we have of getting a “clear” (pending litigation) winner would be if Arizona, and either Georgia or Nevada are called for Biden in the next 24 hours or so. Barring that scenario, we may all be on tenterhooks watching Pennsylvania, which is a must-win state for Trump, through Friday.

Meanwhile, control of the Senate is likely to come down to just one or two Senators…though not for a number of weeks. Democrats picked up seats in Colorado and Arizona, but failed to gain any ground in Iowa, Texas, or Montana. Both Senate races in Georgia could go to drawn-out special elections which would be held on (checks notes) 5 January 2021! If these races wind up deciding control of the Senate, they’ll be watched nearly as closely as Tuesday's election was. In any event, the strong Democratic majority that would have been required to make dramatic changes (an extensive “Green New Deal”, “Packing” the Supreme Court, eliminating filibusters, etc) is unlikely to emerge.

Market Reaction

Traders were generally upbeat on Wednesday, even with the final outcome still up in the air. US indices, led by the tech-heavy NASDAQ, surged in early trade and closed up 3.85%, as was WTI Crude Oil (+2.2% on the day). Bucking the otherwise “risk on” reaction, the benchmark 10-year Treasury yield hit new lows at 0.77% in a sign that bond traders may be wary of a contentious, heavily-litigated outcome in the coming weeks.

In FX land, the reactions have been relatively subdued, with the US dollar sitting in the middle of yesterday’s relative performance chart, while the British pound brought up the rear and the New Zealand dollar led the pack. With the likelihood for narrow margins in the Presidential and Senatorial races, FX traders may be hinting that we’re likely to see at least two more years of the same divided government (limiting the progress for major tax/spending overhauls) and aggressive stimulus from the Federal Reserve. Traders will now shift their focus to today’s FOMC meeting as the next potential driver for the greenback.

FX Daily % Candles
FX Daily % Candles

Original Post

Election 2020: Key Outstanding States To Watch And What The Market Reaction Means

Related Articles

Ashraf Laidi
The Other Dollar Index By Ashraf Laidi - Jan 28, 2022

Just as you become more certain the US dollar will go nowhere but up, you stumble into this analysis, suggesting other ideas. No, this is not a piece explaining the Fed's inability...

Election 2020: Key Outstanding States To Watch And What The Market Reaction Means

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email