The CEO of EBC Financial Group (UK) Ltd, David Barrett, offered his perspective on how the U.S. market could react to either Kamala Harris or Donald Trump being elected president.
What Happened: Talking to Benzinga, Barrett suggested that the market’s response to a Trump presidency might be more predictable. Trump’s policies have historically been beneficial for the oil and gas sectors, banks, financials, and, recently, the crypto markets. However, ESG investments, renewables, and Retail stocks could face challenges under Trump’s administration.
Conversely, predicting the market’s reaction to a Harris presidency is more complex.
“Harris seems to be a lot harder to predict. It would seem a little simplistic to just imply the Biden policies carry on. She seems to be resetting her stance on several key issues that she ran on in 2020 as she shapes up her campaign against Trump,” he said.
Barrett also suggested that the recent tech stock dip and bond market rally might be a defensive strategy by investors to reduce exposure volatility and lock in favorable interest rates. He also recommended focusing on companies with strong balance sheets, excellent cash flow, and steady income streams.
Why It Matters: The election race is heating up, with many political pundits predicting a win for Trump, especially as his popularity surged after an assassination attempt. His choice of J.D. Vance as his running mate strengthened Trump's position, even winning over more millennial voters.
However, a phenomenon dubbed the "Trump Dump" effect is causing a significant downturn in the stock market. This effect was linked to the former president's public criticisms of specific companies and sectors.
Meanwhile, Harris was gaining steam in key areas with a new election poll showing her leading in swing states.
President Joe Biden officially confirmed his decision to withdraw on July 21. Since then, the SPDR S&P 500 ETF Trust SPY, which tracks the S&P 500, has been on a rollercoaster ride. The ETF is down 1% from July 19 to date.
Did You Know?
- Congress Is Making Huge Investments. Get Tips On What They Bought And Sold Ahead Of The 2024 Election With Our Easy-to-Use Tool
Image Via Shutterstock
This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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