Post by account_disabled on Feb 19, 2024 23:37:06 GMT -6
The so-called "blue wave" that many Wall Street banks anticipated did not appear Tuesday night and economists now doubt the forecasts for long-term stimulus and progressive policies. The US presidential race remains very close as mail-in votes are counted in key states such as Pennsylvania, Michigan, Wisconsin and Georgia. But the results in the Senate point to resounding victories for many Republican candidates, which will likely give them control of this chamber and a boost to their minority in the House of Representatives. A government this divided would thwart any Biden Administration plans for large fiscal stimulus, corporate tax hikes, or other similar legislation. The largest banks have reacted with a change in forecasts, advising clients to adjust their portfolios in the face of short-term uncertainty and the possibility of a divided Senate.
Here's what 5 Wall Street experts think about the election, its market implications and the future of the US economic recovery. BlackRock: "Watch volatility" A conclusive presidential election result could take a few days to materialize and increase market volatility , analysts at the BlackRock Investment Institute explained Wednesday. "We prefer to monitor Middle East Phone Number List volatility and remain in high-conviction positions amid sales of risk donkeyets," they explain. "Low trading volumes could likely magnify market movements ." The US elections, in the air due to the result in a handful of key states: Biden asks for "patience" and Trump considers himself the winner, accusing the Democrats of promoting a "fraud" Among the biggest implications of the election results is the small chance that an early stimulus package will be put in place .
Investors had pinned their hopes on a relief bill thanks to a Democratic sweep after months of negotiations that went nowhere. A Biden victory and a divided Congress "could reduce Democrats' ability to launch large-scale fiscal stimulus," BlackRock maintains. A second term for Donald Trump could lead to a larger deal, but the company expects "little public investment in any case." Mizuho: "There will be a blockade no matter who wins" After months of speculation , the lack of a resounding victory ensures "a blockade, no matter who wins ," according to Steven Ricchiuto, chief US economist at Mizuho Securities. "This means that the most controversial initiatives of both parties are not contemplated , at least, in the next 2 years," he adds.