Market reactions to Georgia runoff results — and what they say about the future
By David Brancaccio
Money is moving in response to voters in Georgia giving strength to Democrats. Democrat Raphael Warnock won one of Georgia’s two Senate runoffs Wednesday, becoming the first Black senator in his state’s history and putting the Senate majority within the party’s reach….Then there’s the Russell 2000 index, an indicator of smaller companies. Futures there have been up, jumping more than 2% at one point, partly on bets, again, of more economic relief….Karen Petrou, managing partner of the Washington-based economic consulting firm Federal Financial Analytics, said all of this points to markets taking the “fundamental lesson” that Congress is turning a new page on the divisions and dysfunction we’ve come to expect. These close races, Petrou said, signal “actually a functioning American government, where the dominant force is the more moderate middle because they’re going to be the margin on every vote in the Senate. It’s not the left. It’s not the right. It’s going to be the middle.” The issues that the moderate middle may consider include runaway deficits and infrastructure spending for sustained economic growth — “not for more COVID, one-off checks, the so-called sugar highs,” Petrou said.