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Trump offers his take on the midterms. Sessions is out as U.S. attorney general. American stocks surge into the close. And the second day of Bloomberg’s New Economy Forum is in the books. Here are some of the things people in markets are talking about.

Trump’s Reaction to Midterms

President Donald Trump downplayed the Democratic takeover of the U.S. House to claim his party “defied history” with Republican gains in the Senate. Trump said at a White House press conference Wednesday his party “dramatically outperformed historical precedents” in the midterm election despite a series of retirements by Republican members of Congress. He was both combative and conciliatory at the podium, warning of a “war-like posture” if Democrats use their newly won control of the House to launch investigations into his administration, even as he lavished praise on an opposition party leader he has repeatedly attacked on the campaign trail. Trump said he wouldn’t cooperate with Democrats on policy matters if they torment him with inquiries, adding they would risk public “investigation fatigue” and retribution from the Republican-controlled Senate.

Sessions Is Out

Attorney General Jeff Sessions has resigned at the request of President Donald Trump, according to a letter delivered to the White House, after becoming a target of the president’s open contempt for ceding control of the Russia investigation. Trump installed Matt Whitaker, chief of staff at the Justice Department, as acting attorney general and put him in charge of the Russia probe led by Special Counsel Robert Mueller, according to a U.S. official. Whitaker, who has been a critic of the Russia probe, now has the power to fire Mueller or curb his investigation into Russian interference in the 2016 presidential campaign. Democrats warned against interference in the probe. Senate Minority Leader Chuck Schumer said that “protecting Mueller and his investigation is paramount.”

Stocks Surge

Stocks in Asia were set for strong gains after U.S. equities surged, as investors moved past the hurdle of uncertainty presented by the midterm elections and embraced an outlook for Washington gridlock. The outcome dims chances that Donald Trump’s signature tax cuts will be reversed, but also makes less likely major fiscal initiatives that might have pushed up interest rates. The dollar slid and Treasuries climbed. Tech stocks, which absorbed the brunt of October’s sell-off, led gains as the Nasdaq 100 surged more than 3 percent. and Netflix were among the best performers. Health-care shares rallied as investors saw reduced risk for major changes to the health system. A gauge of volatility expectations declined.

What Trade War?

The trade war of 2018 was, in theory, supposed to hurt Republicans in states vulnerable to higher tariffs and Chinese retaliation, but that didn't really happen in the midterms. Trump’s tariffs were a hot topic in farming regions and the Rust Belt, yet several candidates who opposed Trump’s tariffs were defeated, while some who backed the duties won their races. JPMorgan Chase strategist Marko Kolanovic said the divided result in the midterms actually might get Trump to abandon the trade war in order to save the U.S. economy. A “red wave” where Republicans retained the House and Senate could have been seen as an endorsement of the trade war, Kolanovic said. Here’s a deep dive on how freshly empowered Democrats could help or hurt Trump’s next trade-policy moves.

New Economy Forum, Day 2

The world economy faces risks ranging from surging non-financial corporate debt to U.S. fights with creditors and the potential for a new global dividing line. Those concerns dominated the second day of the Bloomberg New Economy Forum in Singapore on Wednesday, where former Federal Reserve Chair Janet Yellen warned the U.S. might struggle to cope with lending risks that have spread beyond banks. Larry Fink, chairman of BlackRock Inc., questioned the wisdom of the U.S.’s fights with lenders who fund 40 percent of its budget deficit. And in the starkest warning of the day, former Treasury Secretary Hank Paulson said an “economic iron curtain” could emerge as the U.S. and China throw up trade walls. Goldman Sachs's CEO said he feels "horrible" about the 1MDB breaches.

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