Saturday’s shooting at former US president Donald Trump’s election rally raises his odds of winning back the White House, and trades betting on his victory would increase this coming week, investors said yesterday.
Trump was shot in the ear during the rally in Pennsylvania on Saturday in what the authorities were treating as an assassination attempt. Trump, his face spattered with blood, pumped his fist moments after the attack, and his campaign said he was fine after the incident.
Before the shooting, markets had reacted to the prospect of a Trump presidency by pushing the US dollar higher and positioning for a steeper US Treasury yield curve, and those trades could strengthen in the coming week, said Rong Ren Goh, a portfolio manager in the fixed income team at Eastspring Investments Group Pte Ltd (瀚亞投資) in Singapore.
Photo: Reuters
The first shooting of a US president or major party candidate since a 1981 assassination attempt on then-US president Ronald Reagan could upend the Nov. 5 rematch between Republican Trump and President Joe Biden, a Democrat, which has been tight in opinion polls.
“From memory, Reagan went up 22 points in the polls after his assassination attempt. The election is likely to be a landslide. This probably reduces uncertainty,” Vantage Point Asset Management chief investment officer Nick Ferres said.
Immigration and the economy have been the main issues for voters who, according to Reuters/Ipsos polls, see Trump as the better candidate for the economy, even as Biden seeks to benefit from solid growth, slowing inflation and low unemployment.
Under Trump, market analysts expect a more hawkish trade policy, less regulation and looser climate change regulations.
Investors also expect an extension of corporate and personal tax cuts expiring next year, fueling concerns about rising budget deficits under Trump.
That could drive bond selling and potentially add to inflation as interest rates fall, Tallbacken Capital Advisors LLC CEO Michael Purves said in New York.
"If (Trump) wins and does this stuff he said he is going to do, you are going to see a much bigger selloff in the back-end of the bond market,” he said. “I think the bond market is the big (election) trade this year, rather than equities.”
Trump also said in an interview in February he would not re-appoint US Federal Reserve Chair Jerome Powell, whose second four-year term as chair will expire in 2026.
“Trump has always been more ‘pro-market’. The key issue looking forward is whether fiscal policy remains irresponsibly loose and the implication that might have for [renewed] inflation and the future path of interest rates,” Ferres said.
Capital.com senior financial market analyst Kyle Rodda said he was seeing client flows into bitcoin and gold after the shooting. The cryptocurrency advanced after the news broke.
“This news marks a changing point in American political norms and the emergency of greater political violence,” he said. “For markets, it means haven trades, but more skewed towards non-traditional havens.”
Traders would also closely watch market measures of expected volatility today, such as those on the tariff-sensitive yuan, which had begun to price in the US vote.
Stock prices have been rising on Wall Street. Both the S&P 500 and Dow Jones Industrial Average indexes hit record highs on Friday and the S&P 500 is up 18 percent this year.
“Around the five presidential elections of the last 20 years, CEO confidence, consumer sentiment and particularly small business optimism have shifted more favorably in response to Republican victories than Democratic victories,” Goldman Sachs Group Inc analysts wrote.
“To the extent improved sentiment leads to an increase in spending and investment, a Trump victory could boost the earnings outlooks for some firms even without substantial policy changes,” they added.
Additional reporting by Bloomberg
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
Prices of gasoline and diesel products at domestic gas stations are to fall NT$0.2 and NT$0.1 per liter respectively this week, even though international crude oil prices rose last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices continued rising last week, as the US Energy Information Administration reported a larger-than-expected drop in US commercial crude oil inventories, CPC said in a statement. Based on the company’s floating oil price formula, the cost of crude oil rose 2.38 percent last week from a week earlier, it said. News that US President Donald Trump plans a “secondary