Global equities are stuck in limbo, as investors continue monitoring the status of the next round of US fiscal stimulus, while the final US presidential debate before election day passed with little immediate sway on financial markets. Asian benchmark indices are mixed, European futures are little changed, while US futures are marginally lower at the time of writing. The Dollar index is hovering just above the 93.0 mark, while spot Gold is hanging on to the $1900 handle.

The next US fiscal stimulus package is arguably the only hope for an immediate lift to US stocks before November 3. However, given the protracted and apaprently laborious nature of the negotiations, the talks in Washington risks being little more than a show-and-dance ahead of the high-stakes elections. While a pre-election deal would be a positive surprise for markets, the likelier scenario appears to be a post-election event, especially considering the Republicans’ resistance in the Senate.

What’s clear is that a fresh injection of much-needed financial aid for the US economy is necessary, even though US initial jobless claims posted another sub-800k weekly reading, having declined in three of the past four weeks. Continuous jobless claims fell below nine million for the first time since March, though still remains far higher than pre-pandemic levels. Amid these signs of a recovery in the US jobs market, the revival could be threatened if more financial support isn’t rolled out soon, especially as the US continues struggling to keep the pandemic under control.

Still, investors are unlikely to make major moves in the markets, gripped by the looming political risks, with the US elections less than two weeks away. The prudent investor should be prepared for the possibility of heightened volatility in the markets immediately following November 3rd, especially in the event of a delayed official outcome to the elections. Should market participants be met with an extended period of political uncertainty after poling day, that could result in a surge of risk aversion that ensures safe haven assets are well bid in the interim.