US Presidential Elections 2024: The Equity markets continue to remain volatile and one key event being watched out are the US presidential elections . As investors watch and are assessing how markets may react and who may win the elections here is what experts say on how stock market would react irrespective of Donald Trump or Kamala Harris’ win?
Investors are increasingly focusing on the dynamics of the budget deficit, said Alex Kuptsikevich, Chief Market Analyst at FxPro. A couple of years ago, markets chastised the UK for announcing ‘unfunded’ tax cuts. The same could be happening in the US. We do not rule out the possibility that the persistent fall in bond prices (rising yields) and the pull on the dollar and gold since September are a manifestation of concern about this issue. said Kuptsikevich. The candidates are avoiding this uncomfortable topic but will surely return to it immediately after the victory speech. There is potential for volatility in the first few days after the election, as well as a commitment to the original campaign promises.
Stock indices tend to rally soon after an election, after a period of sluggishness in the weeks leading up to it. But it’s worth noting that in previous elections, equity indices have corrected more deeply and accelerated higher than we’ve seen now. A repeat of all-time highs is likely, but it’s hardly reasonable to expect 10% or 15% gains for the rest of the year after election day, as we saw in 2016 and 2020, or even 7%, as was the case in 2012 said Kuptsikevich.
With regards to direct impact on Indian Stock Markets, Chokkalingam G Founder, Equinomics Research Pvt Ltd (Formerly known as Equinomics Research & Advisory Pvt Ltd) does not expect significant change in India US relationship. The US cannot afford hostile relations with both China and India simultaneously and hence there may not be direct impact of the elections said Chokkalingam.
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