Biden’s deal includes an eight-year plan to invest in roads, bridges, the power grid, the internet and public transport
As President Joe Biden confirmed a bipartisan deal had been reached on an infrastructure plan on Thursday, markets in the US closed higher.
The Dow Jones Industrial Average pushed up, while the S&P 500 and Nasdaq Composite closed in record territory.
In Asia, Japan’s Nikkei was up by 0.66% while Hong Kong’s Hang Seng jumped 1.4% and the Australian stock market gained 0.5%.
The US Senate eventually agreed on a $1.2trn infrastructure bill, after Biden was forced to come down from his initial pitch which surpassed $2trn.
The deal includes an eight-year plan to invest in roads, bridges, the power grid, the internet and public transport.
Biden said that investment would create millions of jobs. “We’re in a race with China and the rest of the world for the 21st Century,” he added. “This agreement signals to the world that we can function, deliver and do significant things.”
Michael Hewson, chief market analyst at CMC Markets UK, told The Guardian:
“Last night’s gains [on Wall Street] were helped by the bipartisan agreement of an infrastructure bill, much less than the Democrats would have liked, but still a fairly decent addition to all of the other stimulus packages seen in the past six months. The new spending would include money for roads, bridges, rail and public transit, all areas that have been sorely neglected over the years. While the agreement is welcome it still faces a high bar in passing into law given the Democrats narrow majorities on Capitol Hill.”
“As a consequence of last night’s strong US finish, markets here in Europe look set to open higher, with travel stocks likely to be in focus after the government added Malta, Madeira and the Balearics to the green list, as well as indicating that it would look at dropping quarantine rules for fully vaccinated UK residents returning home from amber list countries later in the summer.”
Jobless claims jumped last week against expectations as the US employment market is undergoing a recovery, the US Labor Department said this month.
First-time requests for unemployment insurance reached 412,000, up by 37,000 from the week before. It is the highest number recorded since May 15.