Anticipation runs high among investors in DAX, S&P500, and similar market players.
The United States is set for a new presidency in January 2025, with Donald Trump's election victory on Tuesday. This news has sparked interest in the potential impacts on various global markets.
BaFin, Germany's Federal Financial Supervisory Authority, has issued a warning against a specific too-good-to-be-true investment offer, reminding investors to be cautious in these uncertain times.
In terms of the S&P500, history suggests a positive outlook. The index has traditionally risen in the six months following a US presidential election, excluding the crisis years of 2000 and 2008. This trend indicates a potential for positive returns following the US presidential election. If history repeats itself, investors can anticipate positive returns following the election.
However, the S&P500's historical trend does not guarantee a year-end rally. A new YouTube video from BÖRSE ONLINE examines the potential impacts of a new Trump presidency on various markets, including American stocks, European securities, Bitcoin, gold, bonds, and other assets. The video may provide insights on whether a year-end rally is likely for assets other than American stocks.
European securities may experience downward pressure primarily because of renewed US tariffs and trade confrontations. Many Europeans expect noticeable negative economic effects from US tariffs, with 70% anticipating significant impact on the EU economy and many supporting retaliatory tariffs[1]. The combination of a 15% tariff increase and a 15% euro appreciation against the dollar presents a “double whammy” for European companies competing in US markets, as this effectively raises prices by around 30%, reducing competitiveness and potentially dampening European equity valuations[2]. Despite this, some stability exists as EU investment in the US is projected to increase by $600 billion under Trump’s term, along with expanded US energy exports to Europe, which may somewhat balance trade tensions[3].
Bitcoin and cryptocurrencies are not directly addressed in the search results, but Trump’s presidency has historically been accompanied by policy ambiguity and market volatility, which can increase interest in non-sovereign assets like Bitcoin as alternative stores of value. Given the uncertainties in trade and currency, Bitcoin could see increased demand as a hedge, though regulatory scrutiny may fluctuate.
Gold traditionally acts as a safe-haven asset during geopolitical and economic uncertainty. With increased trade tensions, inflation concerns (41% of Europeans worry about inflation), and fears of an economic crisis (24%), gold demand and prices may rise as investors seek stability amid market uncertainties caused by Trump-era policies[1].
Bonds and fixed-income assets may be affected by Trump's challenge to Federal Reserve independence and large US debt accumulation, which could lead to interest rate volatility. A strong euro, as currently observed, may reduce yield attractiveness in Europe compared to US debt; however, increased US energy exports and investment parameters may influence bond market sentiment on both continents[2][3].
Other assets will face varying impacts depending on their exposure to US-EU trade relations and currency moves. The euro’s appreciation strengthens European purchasing power but harms exporters, while US trade policies generate uncertainty that may increase volatility across asset classes[2].
In conclusion, a Trump presidency’s impact on these assets is mixed: European stocks may face headwinds from tariffs and currency moves; Bitcoin and gold could gain due to risk and uncertainty; bonds will reflect interest rate and inflation dynamics influenced by US policy shifts; and other assets will vary based on trade and macroeconomic responses. Investors are advised to stay informed and consider their risk tolerance when making investment decisions in these uncertain times.
[1] Source: YouGov Europe [2] Source: Deutsche Bank Research [3] Source: CNBC
- The warning from BaFin serves as a reminder for investors to exercise caution while investing, given the uncertainty surrounding the upcoming changes in US political leadership and its potential impacts on the global market.
- The new presidency in the United States may have mixed effects on various assets, with European stocks potentially facing headwinds from tariffs and currency moves, while Bitcoin and gold could gain due to increased risk and uncertainty.
- Bonds and fixed-income assets may be influenced by Trump's challenge to Federal Reserve independence and large US debt accumulation, potentially leading to interest rate volatility, making it essential for investors to stay informed and consider their risk tolerance during these uncertain times.
