相对2016年而言，本轮“特朗普交易”起始时间更早，虽然交易逻辑几经起落，但是随着大选日临近特朗普民调支持率回升，“特朗普交易”逻辑愈发清晰。首先，标普500在高位继续向上突破，这意味着市场风险偏好继续上行。其次，美联储9月大幅降息50个基点以及特朗普“美国优先”政策将会进一步刺激美国企业，尤其是中小型企业盈利预期有望上修。Affected by the unexpectedly strong Septembernon-farm payroll dataand the impact of data such as the resurgence of core inflation, the three main logical threads of the US stock market, "recession trading" and "rate cut trading" continue to cool down, but with Vice President Debate Pence taking the upper hand and recent poor performance in Harris' interviews, Trump's polling support has surged, leading to a resurgence of the "Trump trade".
From the recent market trends, it is not difficult to see that the trading logic dominated by "rate cut trading" has subsided after the first rate cut by the Federal Reserve, and the "tax cuts + easing" core of the Trump trade has made a comeback. Combining Trump's previous term and his statements during this election process, Trump's policy framework of "tax cuts + easing" is relatively clear, which will overall boost inflation and interest rates in the United States, while the attractiveness of dollar assets will increase, providing favorable support for the overall performance of the US stock market.
Looking back at 2016, the market's expectation for Trump's victory was relatively conservative. After the final victory, it triggered a significant fluctuation in asset prices in the financial markets. In November 2016, the "Trump trade" swept the entire market. At that time, due to the expectation of tax cuts and increased fiscal stimulus by the Trump administration, the S&P 500, Nasdaq, and Dow Jones indices rose by 3.42%, 2.59%, and 5.41% respectively.
Compared to 2016, the current round of the "Trump trade" started earlier. Although the trading logic has experienced ups and downs, with Trump's polling support rising as the election day approaches, the logic behind the "Trump trade" is becoming clearer. First, the S&P 500 continues to break up at high levels, indicating that market risk appetite continues to rise. Secondly, the significant 50 basis point rate cut by the Federal Reserve in September and Trump's "America First" policy will further stimulate American businesses, especially small and medium-sized enterprises, with profit expectations expected to improve.
Investment advice: Before early November, rate cut trading, recession expectations, and the US presidential election will continue to jointly impact the US stock market. Considering the US economyBut after the bursting of the internet bubble and the Fed's rate cut in 2001, the ROI dropped by more than 10%.Still the benchmark expectation, the risk appetite of the US stock market is expected to continue to rise. In addition, with Trump's poll support rate once again leading, under the logic of a rekindled 'Trump trade', the outlook for cyclical and value stocks remains optimistic within the stage. From an industry perspective, sectors such as information technology, energy, and finance are expected to perform better.
Affected by the unexpectedly strong Septembernon-farm payroll dataand the impact of data such as the resurgence of core inflation, the three main logical threads of the US stock market, "recession trading" and "rate cut trading" continue to cool down, but with Vice President Debate Pence taking the upper hand and recent poor performance in Harris' interviews, Trump's polling support has surged, leading to a resurgence of the "Trump trade".
Trump's poll support rate surpasses.
Less than a month away from the US election's 'result day' on November 5, 2024, Trump's poll support rate has surpassed Harris. In the September 2024 US presidential debate, marking the first face-off after Harris became a candidate, Harris fiercely attacked Trump's policies and secured a 'decisive victory,' maintaining a lead in poll support over Trump. Nevertheless, with less than a month to go until the election day, Trump's support rate has risen once again and surpassed Harris. According to the reputable crypto prediction market platform Polymarket, Trump's support rate continued to rise after reaching a 'tied' point on October 3; as of October 14, Trump's support rate stands at 54.0%, significantly ahead of Harris's 44.5%.
Trump's running mate Pence slightly gained an advantage in the US Vice Presidential debate, helping Trump's support rate equalize with Harris. In the October 1 Vice Presidential debate, Pence and Harris mainly clashed on issues such as abortion, healthcare, the economy, immigration, climate change, and the Middle East. As per the results, Pence's more holistic approach and flexible debating skills emerged victorious on issues like immigration and the economy. CBS/YouGov's poll surveyed 1,630 potential voters, with 42% believing Pence won and 41% favoring Harris; CNN's live poll showed 51% believed Pence won, against 49% for Harris. Post-debate, Polymarket indicated a gradual narrowing of Harris's poll lead. Following this, as dissatisfaction grew with the Biden-Harris government's Middle East policies, Harris's support rate declined again.
Furthermore, Harris's unfavorable performance during the CBS political flagship show '60 Minutes' interview on October 7 further widened Trump's poll support rate. Although Harris addressed controversial issues about 'immigration' policy political stance during the interview, her answer of 'building consensus' clearly did not satisfy Americans, especially Democrats. After the show aired, Harris's poll support rate dropped sharply.
In most swing states, Trump's poll support rate surpassed, vying for 'laying winning' Electoral College votes. Notably, in RealClear Politics' statistics, although Harris still led in the national polls, the polling results in individual states showed that on October 6, Trump's poll results reversed from trailing to leading Harris once again. This year's US election has a total of 538 Electoral College votes, with a minimum of 270 votes needed to win the presidency. The current market consensus is that the Democratic Party holds 226, while the Republican Party holds 219 votes, making the core competition between the two parties in the 93 votes of the 7 swing states. However, 6 of these 7 swing states have relatively clear public opinion tendencies, with only Pennsylvania having close support rates for both candidates. Yet, with recent 'reverse' actions from the Harris team, Trump has turned the tables with a 'laying winning' posture since October 6, leading with 281 votes against 257 votes; as of October 13, Trump has taken the lead in all 6 of the 7 swing states, expanding his Electoral College vote advantage to 302 votes against 236 votes.
The 'Trump trade' may once again dominate the US stock market.
Looking back on the recent market trends, it is not difficult to see that the trading logic dominated by 'rate cut trading' took a back seat after the Federal Reserve's first rate cut, while the core of 'tax cuts + easing' in Trump's trading strategy is making a comeback. For the U.S. stock market, the essence of the 'Trump trade' is the expected response of his policy framework to the economy in the future. In other words, the policy proposals during the candidate's election process are significant for the stock market. Combining Trump's previous term and his statements during this election process, the policy framework of 'tax cuts + easing' is relatively clear, which will overall boost inflation and interest rates in the U.S. while increasing the attractiveness of U.S. dollar assets. This will provide favorable support for the performance of the U.S. stock market indices.
Reflecting on 2016, the market had relatively conservative expectations for Trump's victory. Following his ultimate election victory, it triggered substantial fluctuations in asset prices in the financial markets. In November 2016, the 'Trump trade' swept through the entire market. At that time, influenced by expectations of tax cuts and increased fiscal stimulus by the Trump administration, the S&P 500 Index, Nasdaq Index, and Dow Jones Industrial Average rose by 3.42%, 2.59%, and 5.41% respectively. By industry, under the expectations of domestic investment expansion and relaxed financial regulation, the leading sectors were transportation, banks, and diversified finance. It wasn't until January 2017 that the logic of the 'Trump trade' gradually faded from the market.
Compared to 2016, this round of the 'Trump trade' started earlier. Although the trading logic has experienced ups and downs, with Trump's approval ratings rising as the election day approaches, the logic of the 'Trump trade' has become clearer. First, the U.S. stock market large cap index - the S&P 500, continues to break through highs, indicating a continued upward preference for market risk. Secondly, the Fed's significant 50 basis point rate cut in September and Trump's 'America first' policy will further stimulate American companies, especially small and medium-sized enterprises, with profit expectations expected to be raised. Looking at the futures market,E-mini Russell 2000 Index Long positions continue to expand, with the current net open interest reaching a yearly peak. In addition, based on Trump's support for traditional energy and his policy advocacy for the reshoring of manufacturing to the USA, this is significant for oil and infrastructure. It is worth mentioning that among the leveraged funds' positions in the futures market, the Dow Jones Index is the only major U.S. stock index with a net long position advantage.
In terms of industries, the 'Trump trade' is bullish for financial, energy, and information technology sectors. From Trump's policy agenda, in terms of energy, compared to Harris' support for clean energy and tax breaks for electric cars, Trump pledges to vigorously exploit fossil fuels, relax a range of environmental regulations, and doesn't support green new deal policies. Trump sees Biden administration's electric vehicle plan as a threat to the U.S. auto industry and economy, focusing on the development of traditional fossil fuel cars, which is more advantageous for the traditional energy sector. In the information technology sector, Trump's policies favor economic expansion in the information technology industry. For the financial industry, Trump tends to relax financial regulations, support the development of cryptos, and reducing compliance costs will undoubtedly increase the overall profitability of the industry.
Investment recommendation: Until early November, interest rate cuts trading, recession expectations, and the US presidential election will continue to collectively impact the US stock market. Even though the US stock market is already at historical highs, considering the US September non-farm employment data greatly exceeded market expectations, and core inflation is picking up again, the US economy.But after the bursting of the internet bubble and the Fed's rate cut in 2001, the ROI dropped by more than 10%.Still the benchmark expectation, the risk appetite of the US stock market is expected to continue to rise. In addition, with Trump's poll support rate once again leading, under the logic of a rekindled 'Trump trade', the outlook for cyclical and value stocks remains optimistic within the stage. From an industry perspective, sectors such as information technology, energy, and finance are expected to perform better.
Editor/Somer
