Trump’s blasting win causes uncertainty and turbulence to the global financial markets

Van Rompuy meets top US CEO’s at NY stock exchange. Location: New York, United States Date: 23/09/2011 © European Union Source: EC – Audiovisual Service

Van Rompuy meets top US CEO’s at NY stock exchange.
Location: New York, United States
Date: 23/09/2011
© European Union
Source: EC – Audiovisual Service

So Donald Trump against all odds won the US elections and will become the 45th President of the United States of America. The latter had as a result to cause severe and immediate turbulences to the world’s financial markets which experienced serious losses in the first few hours of the elections.

However, Trump’s victory speech that came right after calmed the markets which started to return to pre-election levels. His winning speech was totally different compared to his provocative presidential campaign promises and thus provided at least for now a sense of reassurance.

Yesterday, Barack Obama met with Donald Trump at the White House and discussed both domestic and foreign affairs issues. During their meeting, the markets climbed even further with the Dow Jones Industrial Average to increase by 1.43%, hitting a record high.

Trump’s victory aftermath

The scenario under which Donald Trump would win the U.S. elections was among the ones that risk analysts had assessed but it was never expected that the markets would absorb all the turbulences so quickly and bounce back to pre-election levels within hours.

Nevertheless, the fact that the stock markets reacted so rapidly and gained back all their losses is not at all reassuring investors who still worry about the future policies of Donald Trump. It is quite certain that the financial markets will face more volatility as political and economic uncertainty will spread above the White House.

Stock markets and currencies volatilities

The U.S. elections and precisely the win of Donald Trump had as a result to cause global market shocks. The European stock markets fell upon their opening on Wednesday before recovering  swiftly at the end of the day. More specifically, FTSE 100, a capitalization-weighted index of the 100 most highly capitalized companies traded on the London Stock Exchange, dropped by 2% last Wednesday but managed to recover. The CAC 40 index, the most widely-used indicator of the Paris market was down by 2.9% on Wednesday opening while Germany’s DAX index fell by 2%.

However, all major European indices seem to have absorbed the direct vibrations of Trump’s victory quite fast. As far as the currency markets are concerned, the dollar has hit its highest 4-month record against the Japanese yen while the Mexican peso has been plunged by 13% on Wednesday reaching 20,58 pesos per dollar at yesterday’s session. In general, the dollar has been strengthened against most major currencies such as the sterling and the euro.

Obama welcomes Trump

Yesterday’s meeting between Barack Obama and Donald Trump that took place at the White House pushed stocks even higher in the prospect of loosening regulation and reducing taxes. The discussions were about domestic and foreign policies and the beginning of the 72-day transition process till Trump’s official inauguration on January 20.

Donald Trump’s stance after his victory has been totally different compared to the one before the elections. A much more moderate behaviour was evidently noted during his victory speech and his meeting with Barack Obama due to which relative calmness to the financial markets was caused.

Too soon to predict Trump and markets

It is indeed too soon to understand what the U.S. President-elect has in mind and how the markets will be reacting to his policies from now on. The financial markets though will be shaking again in the short-term since there is still uncertainty about which exactly will be the U.S. trade, migration and economic policies.

The uncertainty will keep on ruling in the minds of the U.S. citizens and global investors as Donald Trump will start unveiling his intentions about his future plans. However, investors should not be influenced by the immediate developments and act according to their long-term benefit.

All in all, the financial markets will experience volatilities in the short-term but will tend to return to their normal levels in the long-run. The main take-away from Donald Trump’s win is that apparently the American citizens have expressed, following the British citizens recently, their disappointment against the current “rotten” political system and global world order.

America sails now in uncharted waters and so do the global markets.

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

Stopping antimicrobial resistance would cost just USD 2 per person a year

UN chief urges top digital tech panel to come up with ‘bold, innovative ideas’ for an ‘inclusive’ future

We can end TB right now. Here’s how

Multilateralism more vital than ever, as World War centenary looms: Security Council

Syria: Why did the US-Russia brokered ceasefire collapse? What does the duo care for?

New EU rules to boost crowdfunding platforms and protect investors

Brexit talks: Today the world to hear of a predictable failure

European Union: Retail sales show deep recession

Banks promise easing of credit conditions in support of the real economy

Companies have a new skill to master – innovation

70 years on, landmark UN human rights document as important as ever

COP21 Breaking News: China has promised to cut emissions from its coal power plants by 60% by 2020

Backed by UN, Asia-Pacific countries to advance space technology for ‘development transformation’

Data exchanges: Strengthening Europol cooperation with non-EU countries

JADE Generations Club 2015: Knowledge vs. competences – Do not wait for the change to happen, but make it happen

Crucial medical supplies airlifted to north-east Syria to meet ‘desperate need’

UN migration agency: young Rohingya girls, largest group of trafficking victims in camps

EU Emissions Trading System does not hurt firms’ profitability

Australia’s record heatwave: From fainting tennis players to dead fish

It’s time to stop talking about ethics in AI and start doing it

ECB is about to lend trillions to banks

New roadmap toward healthier and cleaner oceans adopted by UN Environment and European Commission

GSMA Mobile 360 Series –Digital Societies, in association with The European Sting

Internet milestone reached, as more than 50 per cent go online: UN telecoms agency

National parks transformed conservation. Now we need to do the same for the ocean

Costa Coffee products (Copyright: Costa Coffee; Source: Costa Coffee website, Press area)

The start of the “Caffeine rush”: Coca-Cola acquires Costa Coffee days after Nestlé-Starbucks deal

Mainland Europe adopts Germanic cartel business patterns

Nigeria: Armed conflict continues to uproot thousands, driving up humanitarian need

A Sting Exclusive: “Paris is the moment for climate justice”, Swedish MEP Linnéa Engström claims from Brussels

The Americans are preparing for the next financial crisis

EU Council approves visa-free travel for Ukraine and cement ties with Kiev

Drinking water: new plans to improve tap water quality and cut plastic litter

The EU Commission by serving the banks offers poor support to European mainstream political parties

The Italian crisis may act as a catalyst for less austerity

Brexit: MEPs concerned over reported UK registration plans for EU27 citizens

Despite violence, ‘tremendous hunger’ for peace in Afghanistan: top UN official

Online platforms required by law to be more transparent with EU businesses

EU Budget 2019: no deal before the end of the conciliation period

Child victims of DRC Ebola outbreak need ‘special attention and care’: UNICEF

Central Africa: Security Council concerned by ‘grave security situation’, calls for better agency cooperation

Food choices today, impact health of both ‘people and planet’ tomorrow

Why CEOs need to become activists in sustainability

These are 2018’s stats of the year

Poverty data never tells the whole story

8000 young people in the EP in Strasbourg: “a breath of fresh air for EU democracy”

The issue of health literacy and how it affects European health policies

The Ecofin Council creates officially the clan of ‘undead’ banks

“Is Europe innovative? Oh, Yes we are very innovative!”, Director General of the European Commission Mr Robert-Jan Smits on another Sting Exclusive

Imported and EU fisheries products should be treated equally

Europe bewildered by radicalisation and terrorism

EU-US resume trade negotiations under the spell of NSA surveillance

New rules on drivers’ working conditions and fair competition in road transport

Is Europe misjudging its abilities to endure more austerity and unemployment?

Measuring consumer confidence isn’t useful anymore. Here’s what we should do instead

We can’t rid Asia of natural disasters. But we can prepare for them

Governments and non-state actors need to take urgent action to meet Paris Agreement goals

How building renovations can speed up the electric vehicle revolution

Generation Z will outnumber Millennials by 2019

Making technology work for 1.3 billion Indians

Fighting cybercrime – what happens to the law when the law cannot be enforced?

A Sting Exclusive: “The Digital Economy and Industry are no longer opposing terms”, Commissioner Oettinger underlines live from European Business Summit 2015

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s