‘It’s a completely new world’: How investors, economists and market strategists reacted to Trump’s win

U.S. stocks surged to record highs and longer-term bond yields jumped to multi-month peaks after Donald Trump was re-elected president in an unambiguous shift to the Republican Party in American politics. Republicans have taken control of the Senate, and while there still is some uncertainty, a Republican majority appears within grasp for the House as well.
Here’s how market strategists and portfolio managers from Canada and across the world reacted:
ROYCE MENDES, MANAGING DIRECTOR AND HEAD OF MACRO STRATEGY, AND TIAGO FIGUEIREDO, MACRO STRATEGIST, AT DESJARDINDS SECURITIES
“Treasury yields are rising as traders bet on a combination of increased growth and inflationary pressures reducing the depth of the Fed’s rate cutting cycle. Swaps are pricing in a fed funds rate of roughly 3.85% for the end of 2025, almost 15 basis points higher than yesterday and materially above the Fed’s long-term dot.
While the Fed will almost certainly still cut rates by another quarter-point tomorrow and likely again in December, the pace of cuts could slow dramatically in 2025. The incoming President will try to pressure the Fed to lower rates at a rapid pace, but officials are likely to become fierce in their defense of institutional independence. We expect most policymakers to make every effort possible to adjust monetary policy according to the needs of the economy and not to the pressures from the executive branch.
President-elect Trump’s zero-sum mindset is playing out negatively for other economies globally. With the threat of tariffs hanging over America’s trade partners like a sword of Damocles, all major currencies are weaker against the US dollar today. That said, the Canadian dollar is proving to be more resilient relative to other currencies. That’s because upcoming protectionism is likely to be more directed towards countries such as China and Mexico. To a lesser extent, the Eurozone stands to lose from reduced US security guarantees in the region and the potential for tariffs. As a result, bond yields are falling across the monetary union, with expectations that the European Central Bank will need to cut rates more aggressively to offset the headwinds from trade barriers and weak business sentiment.
Canada might not face the same fate as other major trading partners. Heading into Trump’s second term, Canada will remain America’s second largest trading partner behind Mexico. Energy accounts for 30% of Canada’s goods exports to the US and it’s very likely that Canada’s energy supply is exempted from whatever tariffs are threatened. A potential renegotiation of the USMCA could require some concessions, but the integrated nature of supply chains in the two countries offers some room for Canada to escape the coming wave of US protectionism less battered than other nations.
The Bank of Canada will pay more attention to the latest developments in financial conditions and the evolution of the economy than hypothetical scenarios regarding US policy. Five-year Government of Canada bond yields are roughly 10 basis points higher than they were the day that central bankers unleashed a 50 basis point rate reduction. However, the currency is 2% weaker than what was assumed in the Monetary Policy Report. Overall financial conditions are, therefore, roughly unchanged.
Despite policymakers waiting to incorporate any changes to the outlook from Trump’s policies, uncertainty argues for caution on further rate cuts. The possibility that a second consecutive 50 basis point move could spur a further selloff in CAD leans the same way. Looking at the latest data on the economy, and the tentative reacceleration in the housing market, we’re happy to stick with our call for a 25 basis point cut in December lest we see a notable change in our GDP tracking between now and then.”
BEATA CARANCI, CHIEF ECONOMIST, TD ECONOMICS
“Fed funds futures for the remainder of 2024 are relatively unchanged, still pointing to a 25 bp cut tomorrow and a near 70% chance of another 25-bps cut in December. Further out, pricing has shifted higher by nearly 20 bps, implying that markets are expecting the combination of tax cuts and tariffs raising the Fed’s neutral rate. Importantly, we aren’t seeing much in the way of rising U.S. debt risk premia, which was feared to rise with potentially wider fiscal deficits. The U.S. dollar has continued to gain ground against most of its peers, with the trade-weighted measure up nearly 2% this morning (Chart 1). Most of the gains are coming against the Mexican peso and euro (both down around 2%).
We are changing our forecast for the Fed, as higher inflation results in a slower pace of rate cuts in 2025. We now have the Fed cutting by 25 bps tomorrow, in December, and in January, but then pausing in March. The Fed will continue with a cut-pause-cut pace through 2025, resulting in a higher fed funds rate at the end of 2025 of 3.5%, up from 3.0%. In H1 2026, we have the Fed cutting to 3.0%, implying that we don’t see any change to the neutral rate, just that the Fed gets there later.”
BMO ECONOMISTS LED BY DOUGLAS PORTER:
“The U.S. election results will shift the economic landscape, particularly if the Republicans also manage to hold onto the House. However, there are still plenty of questions around the extent to which the campaign rhetoric translates into policy reality. The lean will certainly be to more tax relief, although the positive growth impact will be countered somewhat by broad trade tariffs and uncertainty, accompanied by a firmer U.S. dollar and higher bond yields. The latter are driven by bigger budget deficits, modestly higher inflation risks, and possibly less Fed easing than previously expected. On balance, this puts some upside risk for our 2% growth call for 2025, but tax relief will take time and so the major impact on growth may be more of a 2026 story. For the Fed, rates are still on track to fall 25 bps this week, and likely by 25 bps again in December, but we look for a slower pace of rate reductions in 2025, with the terminal rate now likely 3.25%-to-3.50% (50 bps higher than previous). …
In the event of a Republican sweep, Canada’s economy might benefit initially from stronger U.S. growth, as its largest trading partner buys three-quarters of its merchandise exports. Energy producers would also rejoice if the Keystone XL pipeline was resurrected. However, the country could be one of the hardest hit (along with China and Mexico) from a possible trade tussle. Increased uncertainty about tariffs and the fate of the USMCA ahead of the 2026 review could depress capital flows to Canada and weaken domestic investment, likely extending the nation’s productivity slump. Suffice it to say, none of this is good for the Canadian dollar, which is already challenged by faster rising unit labour costs relative to the U.S. While tariffs and a softer loonie might add some upward pressure to prices, potential economic weakness could hold inflation below the 2% target, keeping the Bank of Canada in easing mode. The Bank expects the economy to strengthen on the back of further planned rate cuts, and any threat to its outlook could spur a more aggressive response. This explains the initial relative outperformance of Canada’s bond market to the election results, with yields rising less than south of the border and Canada-U.S. spreads hitting extremes. The BoC slashed policy rates 50 bps in October, but a more cautious path of 25 bp moves over the coming months is more sensible given the post-election uncertainty and heightened risk to the Canadian dollar. The federal government might need to adjust corporate tax rates to prevent investment from migrating south. Canada will also be pushed harder to raise its NATO contribution much faster than currently planned, potentially leading to a higher budget deficit. Moreover, Trump’s pledge to deport undocumented immigrants could impede the Canadian government’s goal of slowing population growth if migrant flows increase across the U.S.-Canada border. These issues will play a prominent role in the coming Canadian election.”
DEREK HOLT, VICE-PRESIDENT AND HEAD OF CAPITAL MARKETS ECONOMICS
“Markets are initially reacting in predictable ways at least on the first pass … and the reason why they are reacting this way is that today’s market and macro backdrop is vastly different than it was in the Trump 1.0 2016–17 playbook era. Equity multiples are higher and so are margins which may limit equity gains off of a higher starting point, while an economy that is already in excess aggregate demand faces domestic policy-fed demand stimulus and a three-pronged negative supply shock to population, investment and supply chains via trade tensions. Hello inflation, we didn’t miss you. The fiscal position of the US government faces strong risk of spiralling out of control. Talk of replacing income taxes with tariffs is totally impractical. Loose talk of draconian spending cuts is also impractical partly given carve-outs of untouchable programs, such that deficits are likely to be under upward pressure from here.
An added difference is that a wave of [bond] maturities will have to be refinanced into next year and beyond after issuance that occurred in the depths of the pandemic and its aftermath. That applies in the US—and in Canada where a record nearly $100 billion of corporate debt is due next year.
And so stocks are broadly higher for now on the hopes of lower taxes and deregulation…. US Treasury yields are spiking as the curve steepens on supply and inflation concerns with 2s cheaper by around 10bps, 10s up by about double that, and the long end up by over 20bps. Canada’s curve is broadly cheaper and steeper, but by less than the US with the Canadian 2-year yield up 2bps, 10s up 10bps, and the long-end up by a little more on concern that Canada will import some of the consequences of US policies. …
FOMC cut pricing is being shaved by several basis points across contracts into next year which may only be the start in my opinion. Trump’s policy mixture is a recipe for a higher terminal rate than would otherwise have been the case. BoC cut pricing is little changed so far this morning. …
All of this is a highly tentative market scenario to be informed by the policies that are actually pursued by the Trump administration, their timing, and whether it’s a red sweep. I think c-suites and markets have reason to be very cautious toward the future. A surge of protectionism is all but assured to hang over the global economic outlook as a downside to US and global growth. Fiscal stimulus applied to a US economy that is in excess demand will stoke renewed inflation risk and higher yields with the mixture of tax cuts and spending cuts uncertain, but the former likely to outweigh the latter and drive the US fiscal deficit higher yet. Ratings agencies will be keenly watching sovereign risk with implications for the broader corporate ratings on the next layer of reassessments. A negative population shock, a negative investment shock by curtailing heavy investment in clean energy with ESG initiatives about to be significantly weakened, and roiled supply chains risk shrinking the supply side. Geopolitical risk shifted into higher gear with this outcome.”
DAVID ROSENBERG, ECONOMIST AND FOUNDER OF ROSENBERG RESEARCH:
“A major point to be made is that we will not have to endure weeks or months of a contentious and contested election and all the uncertainty that would have implied. A sigh of relief from that alone. That said, this is more than a relief trade — this is a power trade on steroids. The markets have gone ahead to price in a full four-year term, with hopes of deregulation and corporate tax cuts fueling even more optimism in the stock market —Dow futures +1,200 points! And the KBW index up almost +10%!!
Tesla has surged +12% and Trump Media & Technology has skyrocketed more than +40%!! Visions of an $8 trillion borrowing spree and the overall pro-growth policy thrust are causing a coronary in the bond market (10-year T-note yield +16 basis points to a four-month high of 4.42% — but what is interesting is that market rates in Europe have come down -4 to -5 basis points!) alongside the reduced prospect now of a more aggressive Fed easing cycle (though one can imagine the pressure that Donald Trump will be placing on Jay Powell, as he successfully did in 2019). A looming global tariff war is taking the U.S. dollar (+1.7%) up to a one-year high; completing the risk-on wave is Bitcoin soaring to all-time highs (+8% to $75,372). Along with bonds, safe-haven gold has succumbed to a -0.8% loss to $2,722 per ounce (all market quotes are time-stamped to 4:30 a.m. EST). ….
One would have thought with market betting odds already at 60% prior to the election, that a Trump win was largely priced in. So far, not the case. …
It needs to be emphasized that the election cycle is no match for the business cycle — Richard Nixon in 1972, Ronald Reagan in 1980, Bill Clinton in 1992, George W. Bush in 2000, and Barack Obama in 2008 can all attest to that. And Donald Trump is walking into one of the most acute equity market bubbles of all time and he too will at some point be dealing with the fallout from the pricking of said bubble. And that bubble just got a lot bigger overnight.”
Also see, from David Rosenberg: Investors are partying like it’s 2016-2018 again under Trump. That’s a mistake
JOHN HANCOCK INVESTMENT MANAGEMENT CO-CHIEF INVESTMENT STRATEGISTS, EMILY ROLAND AND MATT MISKIN
“On the global equity side, we are emphasizing U.S. mid-cap stocks to benefit from pro-cyclical policies and manage valuation risk. While small caps are surging on the Trump victory, we prefer moving up in cap to mid-cap equities as they feature higher quality, more profitable businesses and have an overweight to the industrials sector, a potential winner under looser fiscal policy. In addition, mid-caps can help protect portfolios from the valuation risk we are seeing in U.S. equities broadly. Stocks have gotten historically expensive, with the S&P 500 trading at 26x trailing earnings today, up from 17x two years ago (this is the third highest valuation on the S&P 500 in modern history only behind 1999/2000 and 2021). Within the U.S. equity market, mid-caps are trading at the steepest discount to their large cap counterparts since the late 1990′s, helping lower valuation risk.
On the bond side, we are balancing credit and duration risk, advocating for core-plus positioning with overweights to mortgage-backed securities and investment grade corporate bonds in the middle of the credit spectrum. Lower quality credit has become increasingly expensive as of late as high yield spreads remain tight at 278 bps, well below their 20-year average of roughly 500 bps, so there are risks that high yield is priced to perfection. On the other side, long duration could see issues if there is greater deficit spending as it increases supply and strengthens the economy (reducing the need for the Fed to cut rates). This leaves in the middle of the credit and duration spectrums, balancing risks with intermediate core-plus type fixed income mandates.”
RICHARD BERNSTEIN ADVISORS (IN A WRITTEN COMMENTARY):
Our ten quick investment thoughts.
THOMAS MATHEWS, HEAD OF MARKETS, ASIA PACIFIC, CAPITAL ECONOMICS:
“There are a few points to note about the initial market reaction and how things could evolve.
For a start, there’s a faint whiff of the “bond vigilantes” in the sharper rise in yields at the long end of the Treasury curve (which could, in principle, reflect higher term premia). Republican control of the House would increase the chances of a bigger stimulus package, and fiscal risks are plainly higher than they were during Trump’s previous term, given the rise in yields and worsening fiscal outlook in the interim. Ahead of his first win, the 10-year Treasury yield was ~1.8%, the US federal deficit around 3% of GDP, and the outstanding debt ~75% of GDP. Today, those numbers are ~4.4% on Treasury yield, and ~7% & nearly 100% of GDP, respectively.
Our base case remains, though, that the dollar’s reserve status will prevent fiscal worries from growing too great. (And if the bond vigilantes did rear their heads, Republican appetite for tax cuts would probably diminish.) Instead, we suspect that the more important story for the bond market is just the inflationary effect of Trump’s policies, including the tax cuts but also the tariffs and immigration reductions, all of which would be likely to result in a higher path for the federal funds rate.
Meanwhile the U.S. dollar has clearly been boosted by the higher US yields, and its fortunes could therefore depend on the size and scope of any stimulus. It will also be worth keeping a close watch on foreign central banks, and particularly how far they allow their exchange rates to fall to offset the effects of tariffs on their domestic economies. Today’s sharp fall in the Chinese renminbi (by its own low-volatility standards), is perhaps an early piece of evidence on that front.
Finally, Republican control of the House would probably be positive, on balance, for the stock market given the higher chances of corporate tax cuts. But it’s worth a note of caution: the stock market rallied strongly after the 2016 election too, as Trump’s conciliatory victory speech convinced investors that he was more focused on tax cuts than on tariffs and renegotiating trade deals. When the trade war began in 2018, the market did hit a (admittedly short-lived) road block.”
MATHEUS ZANI, FX RISK MANAGER AT FOREX FIRM DEAGLO:
“Market sentiment indicates that a Trump presidency, along with a Republican majority, is expected to stimulate the U.S. economy, the stock market, and retain a strong U.S. dollar over the medium term. The greenback’s strength likely reflects expectations that Trump’s tariff policies could drive a renewed increase in U.S. inflation. Now a thumbtack in Trump’s foot; how to weaken the USD to promote a prevalent US manufacturing industry.
The reduced likelihood of rate cuts has been reflected in the Overnight Night Index Swap curve (OIS) which recorded a 10bp+ repricing across 2025 tenors. This implies a policy rate approaching 4.0% by June 2025, nearly 100 basis points higher than market pricing in mid-September.
Trump has already made several statements, including promises to lower taxes and reduce debt, relying on the age old trickle down effect. This may prove challenging as Trump’s policies are estimated to boost the budget deficit by US$7.5 trillion according to the Wall Street Journal.
Trump has also made peacetime announcements, assuring he has no desire to start any more wars but rather end them. This is likely to continue to depreciate safe-haven assets like the Swiss franc (CHF), Japanese yen (JPY), and gold prices (XAU) in the future (each down ~2% since the election results).”
MATTHEW RYAN, HEAD OF MARKET STRATEGY, EBURY:
So far, we would perhaps argue that the moves in the FX market have been somewhat contained relative to expectations from some quarters. It is very early days, however, and we would expect volatility to remain elevated in the next few trading sessions, as investors position themselves in anticipation of another Trump presidency. This could mean fresh downside in risk assets and another bout of dollar strength, particularly should the Federal Reserve hint to markets at upcoming policy meetings, potentially on Thursday, that the outcome of the election may slow the pace of the Federal Reserve cutting cycle.
For now, of course, nothing changes. President Biden will remain in the top job until early next year, and we will have to wait until 20th January 2025 for Trump’s inauguration. His rhetoric in the meantime will be closely watched by market participants. Commentary that doubles down on his tariff threats and tax cuts could conceivably exert some additional upward pressure on the greenback, as investors pencil in weaker global growth and a higher terminal Federal Reserve interest rate.”
ANDRZEJ SKIBA, HEAD OF BLUEBAY U.S. FIXED INCOME, RBC GLOBAL ASSET MANAGEMENT:
“These election results will be really bad for fixed income and can unwind a lot of the bullishness in fixed income. Trump keeps openly telling people that he will increase tariffs not just on China but with every trade partner. We’re talking 10% tariffs across all global partners. This is a big deal because this could add 1% to inflation. If you add 1% to next year’s inflation numbers, we should say bye to rate cuts. With higher tariffs, the Fed will not be in a position to cut rates even if the economy is slowing down- and that is a toxic mix for fixed income.”
JACK MCINTYRE, GLOBAL FIXED INCOME PORTFOLIO MANAGER, BRANDYWINE GLOBAL INVESTMENT MANAGEMENT:
“The initial reaction is not surprising. This was sort of a 50-50. The market is correctly saying we might see a red sweep. Even if it’s a narrow Republican majority (in the Senate), somewhere out there there are Republicans that are fiscally conservative.
You’re going to get some version of a repricing (of Treasuries) just by nature of the math. It’s just a question of how long does it last. You’re seeing the initial damage today.
Volatility is important here. I suspect we could see a decline in overall volatility.
We’re hesitant to buy or sell bonds. We’re looking at that 30-year auction today as a barometer of demand. I’m sitting on my hands and seeing how things play out. Treasuries have had a pretty good sell-off coming into this. Ultimately you’re making a bet that there is going to be some fiscal responsibility coming out of the Trump administration.”
DAVID BAHNSEN, CHIEF INVESTMENT OFFICER, THE BAHNSEN GROUP, NEWPORT BEACH, CALIF.:
“For now, investor sentiment is pro-growth, pro-deregulation, and pro-markets, as seen in the overnight market action. There is also an assumption that M&A activity will pickup and that more tax cuts are coming or the existing ones will be extended. This creates a strong backdrop for stocks.
Financials and Energy are the obvious beneficiaries of Trump’s victory amid hopes of deregulation and a greater focus on U.S. energy independence. There may even be other sectors that benefit from Trump’s victory, such as technology stocks, especially if the Federal Trade Commission (FTC) is knocked down a peg. We need to see personnel and cabinet appointments in the week ahead to get firmer ideas around all this, as personnel is policy.”
ELLIS PHIFER, MARKET STRATEGIST, RAYMOND JAMES:
“Both parties are going to spend no matter what. This Treasury sell-off is overdone. It’s kind of a knee-jerk reaction.
(In terms of Fed policy) none of the presidents have been silent on rates. It’s going to be a ‘94-’95 scenario. They used this term ‘recalibrate’. It reminds me of a post-’94-’95 period where the Fed was tweaking back and forth to avoid a recession.
Trump’s win is equally as surprising as in 2016. I know all the votes aren’t in, but his current lead in the popular vote is to me the bigger surprise.
I think we’re all watching (the House elections) very closely. It’s always a critical component as markets tend to like gridlock. They like it as business continues as usual.”
JOHN FLAHIVE, HEAD OF FIXED INCOME, BNY WEALTH:
“Inflation might be stickier than maybe would have been without this political landscape, but I don’t see us returning to a post pandemic flare up … It might suggest we take longer or we may not get to the actual Fed’s target of 2%, but … the bias is going to continue to be toward cutting”
CHRISTSOPHER HARVEY, WELLS FARGO STRATEGIST:
“We raise our 2024 SPX target to 5830 from 5535, assuming 21.6x (was 20.5x) 2025E EPS of $270 (no change). The multiple expansion assumes our Econ Team’s year-end 10yr UST forecast of 3.8% and the current investment-grade (IG) credit spread of 83bps … This year many outperforming portfolios have been aligned with Growth and Price Momentum factors. A broadening out of the market and a move down cap will be a challenge to many active managers — as it was back in July. Buy the Election. In the late summer/early fall we advised investors not to “sell the first rate cut,” but rather “buy the election” as 12mo returns following the last six presidential elections and the last six easing cycles have seen median and average returns for the major indices in the double digits. Also, in our view we have under-appreciated economic growth, a solid earnings season (SPX Q3 to date: EPS 6.6% and sales 1.5% above consensus), tight credit spreads, and positive momentum … . We have an overweight on the Banks, and would buy on strength as the regulatory change with a new administration is expected to support group multiples and earnings.”
HENDRIK DU TOIT, CEO, NINETY ONE:
“It’s a completely new world, and we need to understand that.
He (Trump) has a massive endorsement and will move much faster than before. The market will price that in very quickly. What’s really important here is the markets like clarity, and they have that.”
ANDREA SCAURI, SENIOR PORTFOLIO MANAGER, LEMANIK, LUGANO:
“With Trump’s victory, you’ll get much stronger fiscal policies compared to what might have been under a Democratic administration. This will have repercussions for inflation, and you can see that already with this morning’s rise in Treasury yields.
So, who benefits from all of this? I think old-economy sectors, like oil, drilling, mechanical, and heavy industry, will benefit. And probably also tech, as the American consumers will have more money in their pockets, they might spend it on new phones, TVs, or invest in the stock market.”
EMMANUEL CAU, HEAD OF EUROPEAN EQUITY STRATEGY, BARCLAYS, LONDON:
“You have renewables, auto sector, some of the tariff stocks and China-exposed names which are lagging, so even though the market is going up, you are seeing some discrimination based on some of the Trump policies.
Roughly speaking, you have renewable and tariff trade names underperforming, then you have your U.S. consumer and dollar plays doing better. That seems to be the story now.”
DAVID ALLEN, PORTFOLIO MANAGER, PLATO GLOBAL ALPHA FUND, SYDNEY:
“Markets absolutely crave certainty, if we’d had a long contested result you would have seen price swings to the downside in major markets…Trump’s victory was also somewhat priced in at the margins.
I do think Trump 2.0 will be different from Trump 1.0… I don’t think Trump was even expecting to win the first time and was less prepared. This time is different, I expect him to push through a lot of fast major legislation within the first 100 days, so hold onto your hats.”
ROGIER QUAEDVLIEG, SENIOR U.S. ECONOMIST, ABN AMRO RESEARCH, AMSTERDAM
“Given the inflationary expectations associated with Trump’s economic and fiscal policies, we expect U.S. rates to continue rise across the yield curve. We anticipate that the market will further retrace expectations for Fed rate cuts next year due to increased inflation projections, while also pricing in higher term premiums. However, our economic analysis suggests that the full implementation of Trump’s policies – especially the tariffs – will eventually weigh heavily on the US economy.
“Trump’s universal tariffs plan is also expected to have a substantial impact on the already fragile euro zone economy, while the inflationary effects for Europe will be more limited. This could trigger an even more accelerated rate cutting cycle path from the ECB and will likely lead to a greater divergence between the US and European policy rates.”
ANDRZEJ SZCZEPANIAK, EUROPEAN ECONOMIST, NOMURA, LONDON:
“In summary: It’s bad news for Europe.
“Trump winning means tariffs which will adversely affect growth in Europe. The European Commission is expected to retaliate like-for-like, which could mean higher inflation in the euro area – or, as manufacturing firms’ pricing power is so diminished, as we have been flagging for some time, firms could be forced to absorb these higher costs, which in turn may result in some firms shuttering and unemployment rising, thus weighing more heavily on growth.”
KEN PENG, HEAD OF ASIA INVESTMENT STRATEGY, CITI WEALTH, HONG KONG
“A lot of this is based on investors’ view that Trump would cut taxes or at least keep tax rates low. Now that it’s likely to be looking like a red sweep – additional cuts are possible.
Deregulation is another major positive for the economy and markets, particularly for the financial, energy and tech sectors. The negatives are tariffs. That’s going to be negative for global growth, you know, particularly in China, Asia (and)Europe… you see inflation expectations rise.
I think the market is currently still just enjoying the positive aspects of a red sweep, but I think as time passes, you are likely to see the risks … get priced in.”
NAKA MATSUZAWA, CHIEF MACRO STRATEGIST, NOMURA, TOKYO:
“I think the market was not yet ready for a ‘red sweep’… if the ‘red sweep’ materialises, 10-year yields for U.S. Treasuries could go up to as high as 4.50% and above. Dollar/yen could go over 155. They’re kind of half pricing in that level right now.
If Trump can pass tax and spending bills first, then he doesn’t have to rush for the hardline policies against China, which come rather later. If Congress is controlled by Republicans Trump can prioritise economic stimulus measures.”
RONG REN GOH, PORTFOLIO MANAGER, EASTSPRING INVESTMENTS, SINGAPORE:
“With Trump, market volatility is likely to pick up, so trading-wise, it does open up opportunities. The volatility comes from uncertainty surrounding how he intends to follow through on some of his campaign promises.
Right now the markets are focusing narrowly on the prospect of tariffs, because it is the easiest lever to pull directly under a presidential executive order, but we’ve seen between 2016 and 2020 other levers that can be pulled to contain China.
From this perspective, I think a foreign investor is likely to position more defensively towards China-focused risk.”
WONG KOK HOONG, HEAD OF EQUITY SALES TRADING, MAYBANK, SINGAPORE:
“Carnage in HK/China hasn’t really materialised because traders and investors are still awaiting any possible (stimulus) announcements. As for the next four years in general, for a start we may need to download Truth Social app.”
With files from Reuters. Some quotes have been edited and condensed for brevity and clarity.