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Five Things - Europe
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Good morning. Mayhem in D.C., a Blue Wave for Biden and managing expectations for Europe's return to normal. Here's what's moving markets.

Unprecedented

A mob of Trump supporters stormed the U.S. Capitol building late on Wednesday, forcing lawmakers and staff to seek shelter and disrupting the certification of President-elect Joe Biden's victory. Four deaths occurred during the protests, with one woman shot by police as a crowd forced its way into the House of Representatives, while three others died due to medical emergencies, police said. Calm was eventually restored after the National Guard was called out and more than a dozen people were arrested. The joint session to formally count electoral votes and certify the election result has since resumed. Donald Trump's top National Security Council officials and a deputy White House chief of staff are considering resigning over the president's encouragement of the protests, according to people familiar with the matter.

Blue Wave

Earlier on Wednesday, Democrats gained control of the Senate by winning two run-off elections in Georgia, wrapping up a "Blue Wave" outcome that could allow Biden greater scope to implement major pieces of his agenda. Additional aid on the agenda includes support for state and local governments, another extension of enhanced jobless benefits and more stimulus payments like the $2,000 direct checks. A $750 billion to $1 trillion pandemic relief package could emerge this year on top of the $900 billion in aid signed into law last month, Matthew Luzzetti, chief U.S. economist at Deutsche Bank AG, said earlier this week.

Long Haul

U.K. Prime Minister Boris Johnson prepared the ground for lockdown rules to last for several more months as the country's coronavirus deaths hit the highest daily total since April. The government tried to temper expectations for a swift end to the pandemic curbs -- despite a mass vaccination program -- as infections and hospitalizations continued to soar and pile pressure on the struggling National Health Service. Hospitals in London are less than two weeks from being overwhelmed by the virus even in a best-case scenario, the Health Service Journal reported. Meanwhile, Germany's government faced criticism over a shortage of Pfizer/BioNTech vaccines, and promised a production ramp-up in February. A second, similar shot developed by Moderna was cleared for use in the EU on Wednesday. 

Firmed Up

Swiss cement giant LafargeHolcim agreed to buy Firestone Building Products, the roofing unit of Japan's Bridgestone, in a deal worth $3.4 billion to be financed by cash and debt. It expects the acquisition to add to its earnings from the first year, and yield synergies of $110 million per year. Bloomberg reported on Monday that LafargeHolcim was in advanced talks to buy the business. Other suitors included Kingspan and Standard Industries, who dropped out of the bidding, people with knowledge of the matter said.

Coming Up…

French motor home maker Trigano, British home goods discounter B&M European Value Retail and pub owner Mitchells & Butlers are expected to post quarterly trading updates. Also coming up, German factory orders are expected to show a month-on-month decline for November, their first since April. Eurozone inflation, due later in the morning, may recover slightly, driven by rising fuel prices. In the afternoon, get ready for U.S. trade balance and weekly jobless claims, which are forecast to come in slightly above the prior week's. 

What We've Been Reading

This is what's caught our eye over the past 24 hours. 

And finally, here's what Cormac Mullen is interested in this morning

Though gauges of global stocks have been trading at record highs, much of their strength has been thanks to the rally in U.S. equities, at least until recently. Shares from the rest of the developed world are now catching up with their American peers with the MSCI World ex-U.S. Index hitting its highest level in more than 12 years. Optimism about the rollout of multiple coronavirus vaccines and a weaker U.S. dollar are among factors lifting stocks from around the world despite the worsening pandemic. The ``rest-of-world'' index has had a better start to the year than its U.S. counterpart, beating the S&P 500 by almost 2 percentage points so far. That's after it was trounced by about 11 percentage points last year. Non-U.S. stocks suffer from less of the issues often raised by critics of the stock market rally, such as valuation, the risk of higher corporate tax rates now that Democrats have control of the Senate and increased regulations, especially in tech. That suggests their 2021 outperformance could continue.

Cormac Mullen is a cross-asset reporter and editor for Bloomberg News in Tokyo.

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