Financial markets are slowly getting ready to take advantage of the possibility that what was once a presidential campaign has taken a spectacular turn. While it would still be an overstatement to call the June 27 debate between President Joe Biden and former President Donald Trump a historic turning point, the incumbent’s display of stalling and mumbling has changed perspectives about where the race is headed. In both polling news and predictions markets, the Republican challenger has become a clear favorite, up by mid-single digits in other recent surveys, while fears remain that Biden will not be his party’s nominee in November. This has put investors in a 22nd position wondering how a Trump presidency might pan out from a financial and market perspective. “As Trump’s numbers went up in the first (last) week, people started speculating that a Trump victory would mean a slight increase in mid- to long-term inflation, potentially a slower economy, which is why the yield curve flattened a little.” That’s why there was a little pressure on long-term bonds at the beginning of the week, said Mark Malek, chief funding officer at Siebert Advisors. “We’ll keep an eye on that, because there’s no definite direction yet,” he said. , but we think the market is starting to try to figure that thing out.” The safe-haven market reaction has been reasonably benign so far: The S&P 500 has managed to hit record highs, albeit slowly. , and is up about 1.5% since the .SPX mountain 2024-06-28 performance of the S&P 500, on the other hand, with the benchmark 10-year Treasury posting a sustained decline. And, perhaps more importantly, it has also moved below the 2-year note, a phenomenon known as the inverted post curve, despite the fact that the wave has The reversal began in July 2022 and there has been no legitimate recession since then. The pace of the reversal has accelerated for days as Trump surged in post-debate polling, indicating misgivings about the economy’s prospects. By the warehouse of Michael Hartnett, a distinguished investment strategist in the United States, dissecting the reaction of the second Trump presidency to the alternative market in the context of Trump’s possible victory: There were allegations of winner volatility, bets that gain profits because of the post curve. Is stable, bank and era. Losers included long-term bonds, homebuilders, renewable energy stocks and rising market currencies. Hartnett also said the percentage of white areas and the Trump-led Republican sweep of both houses of Congress increased to 36%. However, studying tea leaves has been difficult. There has previously been speculation about what would happen next as a result of the Trump presidency and some of his campaign rhetoric. “Markets are beginning to price in an extension of the 2017 tax cuts and former President Trump’s potential deregulation agenda,” Ed Generators, Washington policy analyst at Raymond James, said in a note. “This is particularly the case on the financial side and more M&A approvals would be expected in a Trump presidency. The possibility of more inflationary policies should also be closely watched.” The ‘Opposite Goldilocks’ response Inflation has been a major drawback for Biden as the consumer price index has risen more than 19% during his tenure, compared to less than 8% during Trump’s lifetime in office. However, it was the president’s faltering debate skills that brought out the knives, with some congressional Democrats and mainstream media outlets like the New York Times calling for him to step down. PredictIt, which is widely watched even though the predictions market is thinly traded, had the probability of a Trump victory at about 59% as of Monday afternoon. On the other hand, in a move, Biden’s defiant statement that he would remain in the race led to a swing on the online betting site, giving him a 29% chance of victory compared to 15% for Vice President Kamala Harris. In recent days, there was great speculation that Harris could step up to Biden in the polls, and she had been overtaken by her chances of becoming the nominee before that revised vote Monday. Despite this fact, PredictIt now gives Biden a 56% chance of becoming the Democrat nominee, while Harris has dropped 12 points to just 31%. TD Cowen’s Washington strategist Chris Krueger called this gift “Biden’s gauntlet” because it’s going to be so powerful for his viability as a candidate. Krueger wrote, “Biden still remains the presumptive candidate…” He wrote that Biden’s interview Friday with ABC’s George Stephanopoulos “was a bit of the opposite of Goldilocks: Good enough to stay in the race, but “Not good enough to ease concerns about sharpness.” — CNBC’s Sarah Min contributed to this text. Correction: Mark Malek Siebert is a renowned funding executive at AdvisorNXT. An old model had misspelled the company name.
