Are you sure about "Trump trades"?
STOXX 600 down 0.5%
Scor, Hugo Boss warn on results
Wall St futures steady
Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com
ARE YOU SURE ABOUT "TRUMP TRADES"?
Traders are starting to coalesce around certain 'Trump trades', but analysts at Rabobank suggest the picture might be more complicated than has appeared so far.
The consensus appears to be that a second Donald Trump presidency would mean higher inflation, hence higher Treasury yields and a stronger dollar, alongside higher U.S. stocks, and possibly declines in equities elsewhere.
That's at least how markets seem to have been trying to react in the past couple of days.
But Rabobank rates analysts think things might not be quite that clear, given they said the pairing of Trump and his new running mate JD Vance "underscores the threat of the US becoming increasingly protectionist and isolationist ... which, in turn, is a threat to global demand (tariff barriers) and in geopolitical terms."
"These threats would tend to argue in favour of lower equities and very possibly lower yields (safe haven demand), which further highlights the difficulty in entertaining what the Trump trade actually is," they wrote in a Tuesday note.
Then, they add, given European stocks fell and European bond yields rose on Monday: "This does beg the question as to the degree to which the 'Trump trade' can be a zero sum game where US stocks rally and UST yields rise as the rest of the world moves in the opposite direction."
"While there are a multitude of moving parts here, it does leave us wondering whether the much-vaunted Trump trade of higher equities/weaker USTs may prove to, in actual fact, be the 'Chump Trade'."
(Alun John)
*****
FOR TUESDAY'S EARLIER LIVE MARKETS POSTS:
NASDAQ: EXPECT MORE BOUTS OF PROFIT TAKING CLICK HERE
LOTS OF RED CLICK HERE
LUXURY UNDER PRESSURE CLICK HERE
POWELL AND TRUMP COMMAND MARKET ATTENTION CLICK HERE
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
