Economists say the outcome of the US presidential election has been largely priced in by investors, as softening inflation helps to buoy shares.
Economists and market experts say the outcome of the US presidential election has been largely priced in by investors as softening inflation helps to buoy sharemarkets both globally and locally.
Liu said investors were therefore starting to buy more cyclical companies – those more exposed to economic activity – which have been the “losing” stocks so far this year, including consumer discretionary companies and property trusts. ‘Markets are, dare I say, relaxed and comfortable about the potential return of Donald Trump to the White House.’For the past few months, the Australian sharemarket has been swinging between 7500 points and 8000 points. It hit an intraday record high of 8081.6 points on Wednesday.
“Markets had a big run up that left them a bit vulnerable to a correction,” he said, noting a weakening in the US labour market, a lack of significant policy stimulus from China, and that profit-taking by investors had dragged down equities in the past week.However, Oliver said there was also an element of political uncertainty starting to creep in.
“Trump’s proposed tariffs would have an adverse impact on the Australian sharemarket,” he said. “He’s talking about a 10 per cent tariff on all imports. We only export 4 per cent of our goods to the US, so that wouldn’t have a huge impact, but it would still affect some producers.”
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