After surviving an assassination attempt, Trump’s chances of winning the White House are up – along with Trump stocks and Bitcoin, among others.
Bullets Flying
On Saturday, Republican candidate Donald Trump survived an assassination attempt.
Not only does this appear to have boosted his chances for a second term as US President, but the stock market also seems to have been impacted.
Wall Street Impacted
On Monday, Wall Street closed higher, building on Friday’s rally as expectations mount regarding a possible second Trump term.
Good for Dow Jones
Although all three major US stock indexes ended far below session highs, it was the Dow Jones Industrial Average that scored an unsurpassed closing high.
What Happened?
Trump was speaking at a rally in Bethel Park, Pennsylvania on Saturday when bullets from an AR-15-style semiautomatic rifle started flying in his direction, one grazing his right ear.
Secret Service Agents quickly pulled him off stage before rushing to a hospital.
Who Did It?
The would-be assassin, 20-year-old Thomas Matthew Crooks, was fatally shot at the scene mere seconds later.
Unfortunately, one spectator lost his life at the rally while two others were critically wounded.
Trump’s Words
While traveling to the GOP National Convention aboard his private plane on Monday, Trump said: “The doctor at the hospital said he never saw anything like this, he called it a miracle”.
With a white bandage covering his right ear, Trump added: “I’m not supposed to be here, I’m supposed to be dead”.
All Bets Are…On?
Following the ordeal, online betting site PredictIt is showing the odds of an election win, with 67 cents for Republican Trump (a boost from Friday’s 60 cents) against Democratic US President Joe Biden’s 26 cents.
Now What?
According to Sam Stovall, chief investment strategist of CFRA Research in New York: “The headline event – the attempted assassination of Donald Trump – did not result in a bottom line event”.
He added: “There’s no change to GDP forecasts, no change to expectations that the Fed will start to cut rates in September, corporate profits are coming in ahead of expectations”.
A Positive Vibe
“So, the momentum in the market remains based on investor optimism,” Stovall said.
The positive mood was also supported by optimism that the US Federal Reserve will start its anticipated phase of interest rate cuts as soon as September, with up to three cuts in total by the end of the year.
Looking Good
Ross Mayfield, investment strategy analyst at Baird in Louisville, Kentucky, says: “A September (rate) cut has been all but cemented”.
He added: “We’re sitting almost exactly where we were seven months ago, which is the promise of Fed rate cuts without a recession. It’s still very much predicated to the Fed coming to the party”.
A Recession in Sight?
On Monday, while speaking before the Economic Club of Washington, Fed Chair Jerome Powell repeated his belief that it’s possible for the US economy to dodge a recession.
Recent data readings have also shown progress in decreasing inflation all the way down to 2%, the central bank’s goal.
The Figures
The Dow Jones Industrial Average (.DJI) climbed 210.82 points, or 0.53%, to 40,211.72.
Meanwhile, the S&P 500 (.SPX) rose 15.87 points, or 0.28%, to 5,631.22, with the Nasdaq Composite (.IXIC) adding 74.12 points, or 0.40%, to 18,472.57.
The Equity Markets
A rise in instability before November’s US presidential election is already expected by equity markets. It’s possible that this doubt may increase the macroeconomic uncertainty, which is already high.
Trump Stocks
With the odds of Trump becoming in charge of the oval office surging, Trump Media & Technology Group stock shot up 36.6%.
In premarket trading, the stock climbed by 67%.
Up and Down
Crypto stocks also increased after Bitcoin rose above $62,000 following Trump’s attack, who is deemed as a leader in the pro-cryptocurrency realm.
After reporting stronger profit and revenue for the second quarter, shares of Goldman Sachs climbed by 1.5%.
But despite beating profit forecasts, BlackRock stock decreased by 0.2%.
Guns and Prisons?
Rumble Inc, the conservative video network, shot up 10%.
And thanks to Trump’s increasing chances of presidential victory, gun makers, private prisons, and health insurers were also up.
Crude Oil
Monday saw steady oil prices.
Brent crude futures grew by 3 cents at $85.06 a barrel by 1326 GMT. And US West Texas Intermediate crude rose 7 cents to $82.28.
IF Trump Wins…
With Trump’s chances of winning a second term increasing:
- The volatility in the US bond market increases,
- The equity market volatility declines and ups stock prices,
- The oil price is reduced.
Consequently, under a Trump administration, the financial markets expect to be more market-oriented than under a Biden one and not as focused on environmental issues and the sustainability of public debt.
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Featured Image Credit: Shutterstock / Evan El-Amin.
The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
