Invest
The US election created a ‘goldilocks scenario’ for financial markets
As the votes continue and the results are collated, the US election is increasingly likely to create a “goldilocks scenario”, an industry expert has said.
The US election created a ‘goldilocks scenario’ for financial markets
As the votes continue and the results are collated, the US election is increasingly likely to create a “goldilocks scenario”, an industry expert has said.
T. Rowe Price’s head of Australian equities and portfolio manager, Randal Jenneke, said that if Biden wins with the Republicans controlling the Senate, it would create a goldilocks scenario where tax changes that could hurt company profits do not occur while the Fed provides support for markets.
“The market over recent weeks appeared to be positioning for a ‘Blue Wave’, which carried the prospect of a much larger stimulus package which could have exceeded US$5 trillion,” Mr Jenneke said.
“With a Blue Wave scenario all but removed, it is very unlikely Democrats will be able to raise US corporate and income taxes for higher-income earners and pursue the more controversial aspects of their progressive agenda.”
With a split congress, T. Rowe Price expects a split congress would result in lower stimulus and continued outperformance of growth.
“Ultimately this means more of the same,” Mr Jenneke said.
“A divided government will constrain stimulus and tax hikes; we expect this to continue to favour growth stocks and the market heavily traded this way overnight with the NASDAQ rising close to 4 per cent and traditional growth sectors of healthcare, IT, consumer discretionary all rising.”
About the author
About the author
Stock market
Is it too late to start investing in market index ETFs?
With the Australian market recovering its losses since the pandemic began, nestegg asked an industry expert if it was too late for investors to begin their investing journey. ...Read more
Stock market
Is it time to buy reopening stocks?
Investors are being advised to look into stocks that could benefit from markets reopening, an analyst has stated. ...Read more
Stock market
Stocks to watch in 2021
Easing political uncertainty, new vaccine hopes, central bank’s willingness to do all it takes and more, and new stimulus packages are likely to act as tailwinds for investors, an analyst has said. ...Read more
Stock market
Australia’s October stock picks revealed
Australian retail investors piled predominantly into high-growth industries such as electric vehicles stocks, cloud computing and recent third quarter IPOs during the month of October, new research ha...Read more
Stock market
How a Democrats sweep could benefit the Australian market
As Americans go to the polls, a Biden victory could help Australia’s sharemarket, an investment bank has revealed. ...Read more
Stock market
What investors should do before the US election
As the election date draws near, investors are being urged to forget the “fireworks and noise” and focus on the long-term fundamentals when investing in the US. ...Read more
Stock market
Big 4 bank flags remediation hit
One of Australia’s big four banks is gearing up to pay another hundred-million-dollar fine, according to the company announcement. ...Read more
Stock market
What are the top 8 IPOs by trades?
Investors looking to outperform the market are continuing to look at initial public offering stocks despite recent market volatility. ...Read more
Stock market
Is it too late to start investing in market index ETFs?
With the Australian market recovering its losses since the pandemic began, nestegg asked an industry expert if it was too late for investors to begin their investing journey. ...Read more
Stock market
Is it time to buy reopening stocks?
Investors are being advised to look into stocks that could benefit from markets reopening, an analyst has stated. ...Read more
Stock market
Stocks to watch in 2021
Easing political uncertainty, new vaccine hopes, central bank’s willingness to do all it takes and more, and new stimulus packages are likely to act as tailwinds for investors, an analyst has said. ...Read more
Stock market
Australia’s October stock picks revealed
Australian retail investors piled predominantly into high-growth industries such as electric vehicles stocks, cloud computing and recent third quarter IPOs during the month of October, new research ha...Read more
Stock market
How a Democrats sweep could benefit the Australian market
As Americans go to the polls, a Biden victory could help Australia’s sharemarket, an investment bank has revealed. ...Read more
Stock market
What investors should do before the US election
As the election date draws near, investors are being urged to forget the “fireworks and noise” and focus on the long-term fundamentals when investing in the US. ...Read more
Stock market
Big 4 bank flags remediation hit
One of Australia’s big four banks is gearing up to pay another hundred-million-dollar fine, according to the company announcement. ...Read more
Stock market
What are the top 8 IPOs by trades?
Investors looking to outperform the market are continuing to look at initial public offering stocks despite recent market volatility. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
