Trump’s win in the US National Election was unprecedented, and it had a huge repercussion on the global market, especially for the US market. Too much pessimism erupted from the last two weeks of trading due to uncertainties about the election. But this week saw a rally in the market itself as most indices closed on a positive high. On the global side, the Chinese government lost no time in dismissing its finance minister due to weak trade figure results for October. Oil was still trading at stable levels despite the new supply from non-OPEC producers.
Global Market and Trump’s Upcoming Presidency
Russell 2000 (1,281.53; +10.1%), NASDAQ (5,237.11; +3.8%), S&P 500 (2,164.45; +3.8%) and Dow Jones reaching a record high (18,847.66; +5.4%) was not affected at all by a surprise win from Donald Trump. As many analysts’ forecasts were circulating in the market, Trump’s winning the election could result in a negative impact on the market itself. Yet the result was surprisingly optimistic as not only did Trump win, but the whole Republican slate also took a winning slide, both in the Senate and the House. The positive trading was attributed to the economic measures proposed by Trump under his presidency. It included cutting down tax rates, increasing spending on infrastructure, and acting against red tapes. Take note that this increase in the market is piling up for a Federal Rate hike this coming December.
The released trading data of China for October does not look good. Both imports and exports fell at 1.4% and 7.3%, respectively. A new Finance Minister Xiao Jie has been appointed by the president to replace the current minister Lou Jiwei. The former proved to be a strong figure for solving their fizzy housing market by utilizing property taxes.
The European market did not share the same sentiment over the week as it slumped down with FTSE 100 for Britain, closing at 6,730.43. The Asian Market recovered with Nikkei 225 closing at 17,374.79 (+0.18%) and Shanghai Composite at 3,195.88 (+0.78%).
Oil and Other Commodities
The latest prediction from OPEC’s World Oil Outlook stated that it could never reach the $60 price per barrel, spanning a decade timeline. This was due to the fact that rising productions are coming in from Kazakhstan, Russia and Brazil. This would be a repeat feat until 2017 in terms of the oversupply of oil slumping any signs of uptick in the stuck $40 trading range. Crude oil closed at 45.27 this week.
Metals experienced a closing rate rebound with Gold at 1,225.20 while corn was at 340.75.
It was a mixed trading week for currencies against the US Dollar. The yuan was weakening against the US dollar by 4.7%. This was due to the fact that China wanted to make a turn-around for their sluggish domestic economy and at the same time, boost their export activities. The US Dollar Index closed at 98.99 while GBP scored a closing high of 1.2673.
The mixed reception of Trump’s win should not deter your goals in investing. Your long-term set goals for investing would not only be affected by the incumbent president but by a lot of other factors. Just take into consideration that the whole impact of Trump’s proposals on boosting the economy could still be influenced by corporate earnings, the Fed interest rate hike, and any other achieved economic goal. Be it known that any President could not fulfill every promise they have given during their campaign. Based on what happened this trading week, make a move to take advantage of recent rallies; thus, putting a nicer outlook for your portfolio. Reconsider reclassifying some industries where you can put your money and where it would most likely benefit upon Trump’s formal investiture. It would be a bullish market outlook next week after all. It would be wise for you to take careful consideration of both what’s losing and what’s gaining in your portfolio.