We predicted that trading on Tuesday would be extremely sluggish. Investors are waiting for the results of the US presidential election and will be staying away from the markets. However, we were wrong. The US dollar fell to all assets throughout the day. We are talking about currencies, stocks, commodity futures.
It is possible that investors did stand aside. This means that the liquidity was low. Speculators entered the game and managed to move the market strongly. In any case, the most interesting things await us on Wednesday, after the announcement of the election results.
By the way, gold has once again exceeded $1,900 per troy ounce. In general, it is not clear why the yellow metal fell so much from its maximum values. After all, the uncertainty is very high, which means that the demand for protective assets is increasing, especially against the background of printing empty money.
What do the markets expect?
Theoretically, if Trump wins the election, the stock market should grow. And if Biden wins, then it should fall. The difference is as follows. Republicans are in favour of tax cuts and a maximal market economy. Naturally, with this policy, American companies and the stock market feel great.
Democrats traditionally wanted to raise taxes in order to increase aid to poor people. They also want to tighten regulations. Of course, neither companies nor markets like this.
The main thing is to understand. No matter who wins the election, there can be very strong movements in any direction during Wednesday’s trading day.
What awaits us today?
10.00 EU Service Sector Business Activity Index for October
10.30 UK Service Sector Business Activity Index for October
14.15 ADP US Employment Report for October
16.00 ISM Business Activity Index in the US Service Sector for October
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