Election Day Uncertainty: Markets Hold Their Breath
As Americans head to the polls to elect their next president, investors are bracing themselves for market volatility. The highly contested race between Kamala Harris and Donald Trump has left the outcome uncertain, and the wait for a declared winner could take days or even weeks.
Stock Futures Rise Ahead of Election Results
US stock futures edged higher on Tuesday, with the tech-heavy Nasdaq 100 leading the gains, up 0.4%. The S&P 500 futures followed closely, rising 0.3%, while Dow Jones Industrial Average futures inched up 0.2%. This comes after a losing day for stocks on Monday.
Investors Prepare for Turbulence
With the candidates holding vastly different stances on the economy, a prolonged wait for a declared winner could inject uncertainty into the markets. Historically, however, while the lack of a clear victory has brought short-term turbulence, it has rarely halted the long-term trend for gains.
Currency and Bond Markets Steady
The dollar traded broadly steady, nudging slightly lower, while the yield on the benchmark 10-year Treasury ticked 3 basis points higher. This comes after traders dialed back bets on a Trump win on Monday.
Federal Reserve Policy Decision Looms
Dead ahead is the November policy decision from the Federal Reserve, which also has a lot at stake on Election Day. Chair Jerome Powell is widely expected to bring in a 25 basis point rate cut at the end of the two-day meeting on Thursday.
Earnings Season Heats Up
Another big batch of quarterly earnings is set to roll in, with results from struggling AI server maker Super Micro Computer and luxury carmaker Ferrari on the docket.
Boeing Strike Ends with 38% Pay Hike
The bitter seven-week strike at Boeing has ended after factory workers voted for a new contract offering a 38% pay hike. The planemaker’s shares moved up 2% in premarket trading.
A Historical Perspective on Market Performance
Amidst the uncertainty, a helpful chart from Truist co-chief investment officer Keith Lerner offers a timely reminder that, regardless of the election outcome, investing in stocks has paid dividends over time.
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