US presidential election -uncertainty & the markets

daheff

So US presidential election is starting to kick into gear. What are peoples views on how it will affect the stock markets, before during and immediately after (ie between now and when Donald T the new president is sworn in?



I think theres going to be a lot of jitters on Wall St. Its going to be a tight divisive election. I can see a lot of mudslinging and arguments going on. I dont think either side is going to be coming out with much credibility afterwards.

I can see a sell off happening soon with people sitting on the sides until they know more about who might win and then come back to the markets towards mid Feb.

BrokenArrows

daheff wrote: »

So US presidential election is starting to kick into gear. What are peoples views on how it will affect the stock markets, before during and immediately after (ie between now and when Donald T the new president is sworn in?



I think theres going to be a lot of jitters on Wall St. Its going to be a tight divisive election. I can see a lot of mudslinging and arguments going on. I dont think either side is going to be coming out with much credibility afterwards.

I can see a sell off happening soon with people sitting on the sides until they know more about who might win and then come back to the markets towards mid Feb.

Honestly i wish i had put some money on trump to win back when he was at huge odds. Im pretty sure hes going to win. Its the passionate extreme people who are voting for him and they WILL vote. But the moderate people who support Clinton will not vote. Its the same logic that was behind the brexit vote. The extreem idiots were the ones who voted and the remainder didnt.

daheff

BrokenArrows wrote: »

Honestly i wish i had put some money on trump to win back when he was at huge odds. Im pretty sure hes going to win. Its the passionate extreme people who are voting for him and they WILL vote. But the moderate people who support Clinton will not vote. Its the same logic that was behind the brexit vote. The extreem idiots were the ones who voted and the remainder didnt.

I agree - I think Trump will win. I dont really like either candidate and i reckon neither will win a second term.

I thinking that the polls are tight and will flip flop over the coming weeks and that uncertainty will mean a dive in markets.

ixus

Peso is the outright bet on him at the moment.

Trump has figured how to manipulate the media and how people use social media these days. If he reduces the attacks and starts to appear presidential i think he gets it.

drunkmonkey

Just cutting and pasting here but read this a while ago

A political crystal ball. Election results may not be so great at predicting stock market returns, but the converse is not the case. It turns out that the stock market has an uncanny ability to predict who will call the White House home for the next four years. If the stock market is up in the three months leading up to the election, put your money on the incumbent party. Losses over those three months tend to usher in a new party.

The statistics are compelling. In the 22 president elections since 1928, 14 were preceded by gains in the three months prior. In 12 of those 14 instances, the incumbent (or the incumbent party) won the White House. In seven of eight elections preceded by three months of stock market losses, incumbents were sent packing. Exceptions to this correlation occurred in 1956, 1968 and 1980. According to Stack, the S&P 500 has an 86.4% success rate in forecasting the election.

Full article: http://m.kiplinger.com/article/investing/T043-C008-S003-how-presidential-elections-affect-the-stock-market.html

What would you trade based on that 86.4% successful nugget?

ixus

ixus wrote: »

Peso is the outright bet on him at the moment.

Trump has figured how to manipulate the media and how people use social media these days. If he reduces the attacks and starts to appear presidential i think he gets it.

Peso hit record low v USD. From @soberlook

https://mobile.twitter.com/SoberLook/status/776925444872531972/photo/1

4068ac1elhodqr

DT was 25/1+ last year, now it's more or less evens.

If HC doesn't win (which may happen) the bank stocks will take a kicking, as they often pay for her 'after dinner speeches and advisory meetings'. DT is more or less self-funding which makes sense if you want to push, rather than be pulled on your own ideas. Another wildcard scenario is the suspension of the entire election for a period, due to civil unrest/protest or unavailability of candidate(s).

Jittery times for the markets as a whole, but prosperous times for everyone longer-term in the new 4th Industrial Revolution.

Amirani

ixus wrote: »

Peso is the outright bet on him at the moment.

Trump has figured how to manipulate the media and how people use social media these days. If he reduces the attacks and starts to appear presidential i think he gets it.

MXN v Trump correlation pretty spectacular atm.

Regards the OP and impact on equities, not so sure Trump victory leads to a sell off by any means.

daheff

Kaylin Freezing Sea wrote: »

DT was 25/1+ last year, now it's more or less evens.

That would make sense. Last year he was one of about 6 nominees for his parties candidate (with similar HC's party side). Now hes one of 2 people who are up for the job...so should be in and around 50-50.

Kaylin Freezing Sea wrote: »

Jittery times for the markets as a whole, but prosperous times for everyone longer-term in the new 4th Industrial Revolution.

Not sure I quite agree with this -not seeing what DT or HC will bring to the table to make things more prospoerous for everybody (not just the US)

Amirani wrote: »

Regards the OP and impact on equities, not so sure Trump victory leads to a sell off by any means.

That wasnt my point (on a Trump win leading to a sell off). My point was the uncertainty of the election will bring a sell off up to the point where the incoming president is more certain.

KingBrian2

Both are very unpopular I see a one term presidency as an earlier poster already mentioned. More uncertainty for the markets.

christeb

ixus wrote: »

Peso is the outright bet on him at the moment.

Or you could just go to Paddy Power.

I'm thinking of putting a sum on him as a stock hedge as I'm sure the market will fall 5-10% if he gets in. Which I think he will. Hilary is just too weak (physically and politically) and this will become more apparent as things heat up.

drunkmonkey

christeb wrote: »

Or you could just go to Paddy Power.

I'm thinking of putting a sum on him as a stock hedge as I'm sure the market will fall 5-10% if he gets in. Which I think he will. Hilary is just too weak (physically and politically) and this will become more apparent as things heat up.

If he wins what your going to need is some guns and a shed load of cement.

Think we've missed the boat on the gun run but still a few quid in bricks and mortar to be made.

BrokenArrows

drunkmonkey wrote: »

If he wins what your going to need is some guns and a shed load of cement.

Think we've missed the boat on the gun run but still a few quid in bricks and mortar to be made.

To build a bomb shelter and protection? Haha.

Francie Barrett

drunkmonkey wrote: »

If he wins what your going to need is some guns and a shed load of cement.

If Trump wins the election, then gun stocks are actually a terrible investment. Because Obama has been threatening to put restrictions on gun control, Americans have actually increased their buying in anticipation. This has driven the stock price of companies like Smith & Wesson through the roof. If Trump were to get into power, then you can be guaranteed the Second Amendment won't be touched, so the need to stockpile now goes away.

4068ac1elhodqr

One aspect to consider is the possibility suspension of the election process.

With the two marmite type candidates and factors such of health or civil unrest this could become a real possibility.
Even if Biden came into the process, the timeline would be effected to an extent.

If it does go ahead, the most significant change to the economy would be the gradual decline of the personal service industries, being replaced with automation, IOT-AI and even robotics. During and indeed long after the next 4yr term. This would begin to have a cataclysmic effect on the current labour market models. But the US should be well able to adapt to these changes in any case.

4068ac1elhodqr

Market jitters today, pre-showdown 01:00 GMT. But Mex exporters fairly jubilant thanks to devaluation.



Expect to hear within the 1st 5mins, the following comments (to mark off on your debate bingo cards):

"Crooked Hilary"
"Hateful Retoric"
"Beleive Me..."
"Who, by the way"

If Hills isn't energetically tap-dancing through this, expect gold, and other safe havens to get a overnight market boost.

4068ac1elhodqr

Those banks^ will recover tomorrow, as will MXNUSD, forex traders have now decided Trump is loosing and Peso Rebounds.

If he doesn't hire a speech writer sharpish, he and the border bricklayer crews can kiss the big wall goodbye.

ixus

You assume the markets are smart. All assets rallied as if there was no chance of a Brexit right into the last possible trade before results started coming out. All on the back of polls and betfair odds.

People did not want to reveal they voted for Brexit as they were being called racist, xenophobic. Transfer that to Trump and the view held of him by democrats, women, hispanics, black lives matter, actors. You have to be fairly right wing to stick your neck out and say I'm voting for Trump.

It's not over on the back of this debate.

For ever odd

I don't think it will even be close, Clinton by a country mile(10%+)

Clinton or Trump? Say now or forever hold your peace.

4068ac1elhodqr

ixus wrote: »

You assume the markets are smart. All assets rallied as if there was no chance of a Brexit right into the last possible trade before results started coming out. All on the back of polls and betfair odds.

To clarify, I'd ignore all polls, polls of polls, and their subsequent 'polls of polls of polls'. These are generally sponsored by media overlords, as tools of influence, ignore them. The markets and betting exchanges are far more smarter reliable indicators, along with your own judgement or insight.

In Brexit, the markets were always more cautious than the polls and media experts. Plenty of folks also did very well on the back of Brexit. 1300% was available on the initial results of Sunderland, if you were fast enough. The early morning 62% leave vote signaled a game over, and more importantly the markets/exchanges reacted quickly to this, well before the pollsters did.

Agree it's not over until it's over, but Trump now has an real uphill battle after last nights performance, which beforehand was fairly plain sailing.

drunkmonkey

If you were to listen to Trump it's sell sell sell http://www.zerohedge.com/news/2016-08-02/trump-urges-his-fans-sell-stocks
He's offloaded himself..

phantom_lord

Be weary of your political bias here, nearly everyone in Ireland identifies far more with Hillary and therefor wants and expects her to win. Looking at the polling there's no way she wins by 10%, or even that she's a massive favourite.

A few people have made the point that Trump's aim wasn't to win the debate, but to look calm and reasonable. He controlled himself, he didn't use the name calling he used in the republican debates, or on the campaign trail. He barely attacked Clinton. I'm actually surprised at the polling of who won the debate, he wasn't that far behind, I personally thought he was trounced. I still think the value is on betting on Trump.

4068ac1elhodqr

Think the majority of folks (anywhere) have 'pity and apathy' for those having to choose from these two remaining candidates. Any euphoria of strong bias left for either was lost after this 1st live debate. Even those who concede DT may well have been the best of a bad bunch will despair after that clumsy performance.

Again, ignore all polling and in particularly social media (auto-content-generating tw-bots are a real factor here). Ignore also all across-the-line publishing media also, many of whom are less than credible. The silent/silenced majority will be the decision makers (as per Brexit), but they will be influenced primarily on the basis of the three debates - using just their own common sense and personal interests.

Value has long gone on betting for DT, there was 3.3 available for a short while after the debate, but now the best you can expect is to triple any stake. One value option bet @7.0 is available for HC to withdraw from the race (but health appears to be less of a issue now). Imagine if you're fast enough, trading bank stocks and FX - midway during the next debate is another route to profit.

For ever odd

Have a look into the history of women running in high profile Elections.

Thatcher, Robinson, McAleese and Merkel spring to mind.
There will be a high percentage of the fairer sex that will vote for Clinton - well because she's a....

phantom_lord

Trump is 3.2 on Betfair, when the 538 model has it at nearly 50/50. That looks like much better value that betting on HC to withdraw.

Also I thought this was interesting:

http://www.breitbart.com/2016-presidential-race/2016/09/26/debate-flash-poll/

Pat Caddell, the Democratic pollster and Fox News Insider, told Breitbart News that poll respondents said Clinton performed better at the debate; 48 percent said Clinton did a better job, compared to 43 percent, who said Trump did the better job.

“However, 95 percent of the people we contacted told us they were not going to change their vote based on the debate,” Caddell said.

Two percent of voters, previously undecided, switched to Trump after the debate. No undecideds went to Clinton. One percent switched from Trump to Clinton, and one percent switched from Clinton to Trump.

Reminds me a bit of looking at the twitter stream when Vincent Brown is on, and everyone thinks their guy won.

Francie Barrett

Candidates own supporters always think their guy (gal) won.

Personally, I think Trumps wins the election regardless. From reading opinions from people who are on the fence/middle ground, I see quite a few who are tacitly siding with Trump.

4068ac1elhodqr

As per this thread title, take polls and twitter with a large grain of salt,
instead 'follow the money', the safe-havens of gold and silver just got cheaper this week,
and €5k is available on BF for DT @3.3 if desired.




Worth noting there is still two rounds left, and the issue of 'the wall' hasn't come up yet.

KingBrian2

I hope Trump wins, I wish him all the best. It will be trough though. Markets are siding with Clinton as with the British referendum.

phantom_lord

Sterling rallied right into results night of Brexit.

4068ac1elhodqr

phantom_lord wrote: »

Sterling rallied right into results night of Brexit.

Sterling was strong on brexit night, but maybe not as strong as the unanimous media confidence. Once the Sunderland results started to arrive after midnight, the international fx/markets/exchanges reacted almost instantly. Whilst the majority of media, twitterati, polls and analysts were still very confident of bremain, until the sun came up that is.

reforger

This is an interesting observation from the Guardian today:

According to a recent poll conducted by ABC/Washington Post only 49% of voters under the age of 40 said they were likely to vote in November. A similar poll in 2012 put that number at 71%.

Turnout among the younger demographic gave Obama the edge in 2012; if this figure is replicated on election day it could spell trouble for Clinton.

BrokenArrows

Does anyone have any thoughts on what will happen to the markets if trump gets elected.

Quite simply due to his reputation im sure the markets would open a few percent down in the US.

ixus

I would be interested to see who walks in the FED. That's where i think the real reaction comes. Gives some of them an excuse to jump ship.

On the Poll massaging.

http://www.zerohedge.com/news/2016-09-29/how-reuters-tweaked-its-latest-poll-show-clinton-lead

KingBrian2

BrokenArrows wrote: »

Does anyone have any thoughts on what will happen to the markets if trump gets elected.

Quite simply due to his reputation im sure the markets would open a few percent down in the US.

It depends on what steps he takes to address the financial crisis the world is still in. Being a tough negotiator with China, Russia & Mexico will be a big part of his program for government. He might approach it from a Greek style and get a deal on the debt America owes. The other world leaders are not going to refuse dealing with the President of the USA.

Thanos

I see the ISEQ seems to have dropped like a stone this week, most of the shares listed there are down a good bit.
Is this related to the US election also or are there other factors at play?

daheff

Thanos wrote: »

I see the ISEQ seems to have dropped like a stone this week, most of the shares listed there are down a good bit.
Is this related to the US election also or are there other factors at play?

Brexit, Deutsche Bank, upcoming budget talks...take your pick

conditioned games

It's shaping up to be a turbulent October on the world stock markets by the looks of things. Deutsche bank is grabbing all the headlines at the moment as it tries to deny it needs a rescue plan. Could we be in the early stages of another Lehman, in any case it's only a matter of time before we all get a reality check. A bad October on the world markets would benefit Trump so it may not be all bad.

For ever odd

ixus wrote: »

You assume the markets are smart. All assets rallied as if there was no chance of a Brexit right into the last possible trade before results started coming out. All on the back of polls and betfair odds.

People did not want to reveal they voted for Brexit as they were being called racist, xenophobic. Transfer that to Trump and the view held of him by democrats, women, hispanics, black lives matter, actors. You have to be fairly right wing to stick your neck out and say I'm voting for Trump.

It's not over on the back of this debate.

Good call.

drunkmonkey

Time to crank this baby up again, S&P is up since the 3rd of August history tells us Trump will be staying.

So what we buying this time?

Smith & Wesson has had a good year so far, Cemex not so good, might rally with a second term, that wall isn't going to build itself...:D

phantom_lord

He's been shorting up recently, and in the battlegrounds he's doing better now than in 2016

https://www.realclearpolitics.com/epolls/2020/president/us/trump-vs-biden-top-battleground-states-2020-vs-2016/

Biden still clear fav though obv.