The 2024 presidential race continues to dominate headlines as President Joe Biden announced on Sunday that he will not seek reelection and endorsed Vice President Kamala Harris as the Democratic nominee. This unexpected move has sent shockwaves through the political and financial world, with market observers predicting increased volatility on Wall Street in the short term.
Investors and analysts are weighing in on the potential impact of Biden’s decision on the markets. Wayne Kaufman, chief market analyst at Phoenix Financial Services, expressed uncertainty about the market implications of this historic event. Julie Biel, portfolio manager at Kayne Anderson Rudnick, highlighted the unprecedented nature of the situation and the uncertainty it brings.
Matt Maley, Chief Market Strategist at Miller Tabak + Co., predicted that Trump trades such as Bitcoin and energy will start to unwind, leading to increased volatility in the coming months. Yung-Yu Ma, chief investment officer at BMO Wealth Management, noted that the Trump trade is likely to take a breather until the Democratic nominee becomes clearer, causing some near-term choppiness in the markets.
The news also rattled currency and bond markets, with money managers in emerging markets expecting some early “Trump trades” to be unwound. Jack McIntyre, portfolio manager at Brandywine Global Investment Management, believes that the initial reaction will be positive for risk assets, including emerging markets.
Overall, the uncertainty surrounding the 2024 presidential race is expected to impact the markets in the coming months. With the potential for Fed rate cuts and a broader risk-on bias associated with the Trump trade, investors are preparing for a volatile but potentially lucrative 2025. Stay tuned as the political landscape continues to evolve and influence market dynamics.
