Increased exposure to US assets – US funds, US stocks and the dollar – and perhaps crypto or gold. Here are some tips from the experts. Especially if the Republicans take over both the White House and the US Congress in the election.
But the tips come with firecrackers.
“Investors should probably prioritize caution and flexibility,” writes the economist Tiffany Wilding and the political expert Libby Cantrill on the American asset manager Pimco in an analysis before the election.
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Photo: Evan Vucci/TT This is how interest rates can be affected – if Trump wins
Promises of reduced corporate tax have caused the stock market to follow suit Donald Trump’s opinion figures up and down before the election, states Elizabeth KopelmanUS economist at the large bank SEB.
High tariffs and mass deportations are seen as potentially driving inflation and wages. That, together with higher budget deficits, can push up interest rates and the value of the dollar – and then make it difficult for the US central bank, the Federal Reserve (Fed), to lower the key interest rate at the rate currently expected.
“And somewhere you reach a tipping point where it may be difficult for the United States to attract capital from the outside world,” warns Kopelman.
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Industries that could benefit – if Trump wins
Deregulation can benefit industries such as pharmaceuticals, crypto and finance, the Danske Bank strategist believes Maria Landborn. Reduced exposure to China is another tip:
— Trump will be tough on China. He talks about tariffs of 60 percent on all Chinese goods.
Lars Söderfjellhead of equities at the Bank of Åland, believes that small-cap stocks and cyclical stocks with high US exposure will benefit if Trump wins.
— And all non-US stocks risk being negatively affected by increased trade barriers, he warns.
But some Swedish export companies can, on the other hand, benefit from a strong dollar and lower US taxes, according to Söderfjell.
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Photo: Evan Vucci/TTWhat happens to the stock market if Trump wins?
Oil and gas stocks are a joker in the game. A slowdown in the green transition and more fossil energy can push down energy prices. This means marginal pressure for the sector.
— As an investor, you should not count on Trump’s policies favoring oil stocks. I don’t think so, says Landeborn.
She takes the opportunity to warn against exaggerating the importance of the election for how things are going on the stock market.
— If the economy is good, the stock market will rise. If we get a weak economy, the stock market will fall. It does so regardless of Donald Trump or not Kamala Harris will be the next president of the United States.
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