2016-11-09 12:06:20

It seems that Trump is leading presidential election in the USA, he has already said to his supporters in New York that Clinton congratulated him on his victory in the presidential election.

Many economists believe that Trump’s economic policies may slowdown economic growth in the country and shudder fundamentals of the US economy, which will cause the decline in stock assets.
Trump calls for the tax cuts, immigration restriction and protectionist policy in trade.

Sharp volatility in the market caused by the announcement of the first results of election, has stopped and financial markets are gradually stabilizing and the USD is regaining some of the losses.
The US stock indexes have also regained at the beginning of the European session.

However, it is still likely that the Fed will raise interest rate in December. And this is another negative factor for the US stock market. Economists expect that the Fed will raise interest rates twice next year. The U.S. economy is steadily recovering. However, the increase in interest rate is an insufficient measure to change bullish trend of the US market. It is possible that the markets will stabilize in before FOMC meeting in December.

At the end of last month, US Commerce Department reported GDP (with the adjustment for inflation and seasonal factors) has grown by 2.9% on annual basis against the forecast of + 2.5%, which is the strongest growth in the past 2 years.

According to the data released by the U.S. Labor Department last Friday the number of jobs in October has increased by 161 000 against the forecast of +173 000 and 191 000 in September. Unemployment rate fell to 4.9% in October, as expected, against 5.0% in September. Although NFPR was below the forecast, the indicators were quite strong and, considering positive GDP, the Fed may raise the rate in December.

After the election, when the markets will finally calm down, US macro-economic indicators will regain their importance. And we know that they demonstrate a positive trend, which will support the USD and the US stock market.

DJIA