1. Stocks Fluctuate Amid Key Georgia Senate Runoffs

Stocks wavered amid key elections in Georgia that will decide which party controls the U.S. Senate for the next two years, setting the scope of President-elect Joe Biden’s agenda. The S&P 500 swung between gains and losses after posting its worst start to a year since 2016. There’s a perception among several traders that if Democrats prevail in Tuesday’s runoff, Congress will deliver a more generous stimulus package, potentially leading to upward pressure on inflation and interest rates as well as higher taxes to pay for fiscal aid.
The S&P 500 was little changed as of early morning New York time.

The Stoxx Europe 600 Index decreased 0.5%.

The MSCI Asia Pacific Index climbed 0.6%.

2. Saudi, Qatar Borders Reopen Before Gulf Summit

Qatar’s ruler landed in Saudi Arabia on Tuesday to a warm embrace from host Crown Prince Mohammed bin Salman, hours after their nations re-established travel ties and eased a regional dispute. Qatari Emir Sheikh Tamim bin Hamad Al Thani is attending the Gulf Cooperation Council summit for the first time since a 2017 row that cut trade, travel and diplomatic ties with Saudi Arabia, the United Arab Emirates, Bahrain and Egypt. Saudi Arabia reopened its air, land and sea borders with Qatar on Monday, a leap toward easing the crisis that had complicated U.S. efforts to isolate Iran amid heightened tensions.

3. Oil Rises Above $48 With OPEC+ Talks Set to Start Second Day

Oil gained ahead of a resumption of OPEC+ talks that were unexpectedly suspended due to a disagreement over whether to raise output in February. Futures in New York rose above $48 a barrel after dropping the most in two weeks on Monday. Discussions will restart on Tuesday after a majority of members, including Saudi Arabia, opposed Russia’s proposal for another supply hike. The talks are happening against a shaky short-term demand backdrop. England was ordered into a third lockdown until mid-February, Germany is set to extend its curbs and Japan is considering another state of emergency for the Tokyo area. Several Asian refiners won’t be getting into long-term supply contracts for fuel sales this year, a sign the region’s energy consumption recovery is far from certain.

4. China Stock Index Tops 2015’s Peak, Closes at 13-Year High

China’s stock benchmark has ended above its 2015 bubble high, marking a recovery from one of the country’s worst equity crashes. The CSI 300 Index rose 1.9% at the close on Tuesday, surpassing the peak from June 8, 2015. That is its highest since 2008. That advance helped push the value of China’s domestic equities to a record $11 trillion. China’s stock benchmark outpaced MSCI Inc.’s global benchmark by the most in six years in 2020, with savers funnelling cash into thousands of new stock funds after some popular wealth products suffered their first-ever losses. The bullishness was reinforced by a strong currency, as well as data showing China’s economy was rebounding faster than other major economies from the virus pandemic.

5. JPMorgan Says Bitcoin Could Surge to $146,000 in Long Term

Bitcoin has the potential to reach $146,000 in the long term as it competes with gold as an asset class, according to JPMorgan Chase & Co. Bitcoin’s market capitalization of around $575 billion would have to rise by 4.6 times — for a theoretical price of $146,000 — to match the total private sector investment in gold via exchange-traded funds or bars and coins. But that outlook depends on the volatility of Bitcoin converging with that of gold to encourage more institutional investment, a process that will take some time, they said.

6. NYSE Abruptly Reverses Plan to Delist Chinese Companies

The New York Stock Exchange has abruptly reversed plans to delist three major Chinese telecommunications companies after consulting regulators about an investment ban ordered by President Donald Trump. Coming days before the companies were to be delisted — and just over two weeks before Trump is to leave the White House — the U-turn avoids a step that threatened to heighten U.S.-China tensions further. The Big Board gave no reason for its decision in a statement released during Asian hours, saying only that it had consulted “relevant regulatory authorities” about Trump’s executive order, signed in November as part of his administration’s push to check China’s growing economic power.

7. Saudi, UAE Business Conditions Improve, but Employment Falls

Business activity in the Arab world’s two largest economies improved at the end of last year, with Saudi Arabia seeing its strongest expansion in 13 months. After 2020 setbacks caused by the spread of Covid-19 and lower crude prices, non-oil private sector economies in the United Arab Emirates and neighbouring Saudi Arabia still faced job losses as firms adjusted to the challenges of the global pandemic. Purchasing Managers’ Index surveys in December for the two Gulf nations rose above the threshold of 50 that separates growth from contraction. In Saudi Arabia, the gauge rose to the highest since November 2019, driven by an increase in output and new business.

8. Danes Get 20-Year 0% Mortgages

Denmark stands out in a global context as the country to have lived with negative central bank rates longer than any other. Back in 2012, policymakers drove their main rate below zero to defend the krone’s peg to the euro. Since then, Danish homeowners have enjoyed continuous slides in borrowing costs. The once unthinkable notion of borrowing for two decades without paying interest comes as central bankers across the globe shy away from rate hikes. No major western central bank is likely to raise rates this year. As rates have continued to sink, banks in Denmark — home to the world’s biggest mortgage-backed covered-bond market — to offer 20-year loans at 0%.

9. Airlines Start to Scrap U.K. Flights Following New Lockdown

Airlines kicked off 2021 by shrinking their already meagre U.K. schedules, prompted by a new coronavirus lockdown and the prospect of further restrictions on travel abroad. The fast-spreading virus strain that’s driven up U.K. case counts has also dashed airline-industry hopes of relief from 2020’s unrelenting downturn. Prime Minister Boris Johnson late Monday announced a new coronavirus lockdown that will keep most people at home until mid-February when vaccines being rolled out are able to stem the worst infection rates since the start of the outbreak.

10. Merkel Pushes for Strict Curbs With Vaccine Strategy Under Fire

Chancellor Angela Merkel is seeking tighter lockdown restrictions to contain the coronavirus as criticism over Germany’s vaccine rollout sparks feuding in her cabinet. The chancellery is proposing a limit on how far people can travel from their homes in areas with high infection rates. The plan has run into opposition from state leaders, who are joining a video conference with Merkel on Tuesday to decide the next steps in fighting the disease. The political tensions threaten to escalate amid a rising tide of criticism that the government bungled the rollout of a Covid-19 vaccine.

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