How Is Wall Street Reacting to U.S. Election Results?
Financial sector executives have called for caution as there was no clear winner in the 2020 U.S. presidential election within hours of polling station closing, threatening protracted calculations that keep markets and businesses on edge..
Although the Republican president Donald Trump provided the financial industry with huge tax breaks and deregulation, his first term was also marked by instability and unpredictability, especially in international trade.
The administration’s hesitant response to the coronavirus pandemic has also come under heavy criticism this year. The U.S. economy collapsed, markets began to storm, and unemployment skyrocketed as cities and states took different quarantine approaches to stem the spread of the virus..
Wall Street is leaning to the left in this election. While many in the industry have said they do not support the entire policy Joe Biden, they believe he will be more predictable and a better president for the country.
«This is a vote for the soul of our people. Who we really are. Who we strive to be», – tweeted Mike Novogratz, CEO of New York-based Galaxy Digital, major sponsor and fundraiser for the Democratic Party.
«You have to admit the déjà vu feeling. I do not like. However, it is still early», – tweeted a former macro hedge fund manager as results began to emerge showing the race was still too far from over.
Late Tuesday, global investors began to wind down some of the deals that had sparked a jump in major Wall Street indices earlier in the day..
Analysts were expecting record voter turnout, especially with the mailing of ballots, which means it may take days to get certain of the final count. Trump and Biden teams said they are ready to challenge the outcome of the election.
Investors and fund managers said they were expecting a long night watching the results from home. For many, this was very different than November 9, 2016, when there was no pandemic, countless informal bar parties were held in New York and other financial centers, and Trump’s victory was announced at about 2.30 a.m..
This year, Novogratz tweeted that he was at home with a bottle of wine and watched the results on TV with his family.. Max Gohman, Asset Allocation Manager Pacific Life Fund Advisors, said he worked from his home in California, made a glass of bourbon, iced coffee and had no intention of going to bed.
Anthony Scaramucci, The hedge fund executive, who served 11 days as Trump’s director of public affairs in 2017, said after closing many sites on the East Coast that the race will be longer than he originally thought, but he still expects Biden to win. Scaramucci, who became a staunch opponent of Trump after his brief stint in the White House, said he voted for the Democratic nominee.
«Yes, he can win and it will be very good for the stock», – he stated.
In anticipation of possible protests, several buildings and shops were boarded up in cities including Washington and New York. While there were few signs of unrest or violence at polling stations on Tuesday, some finance executives said it was too early to rule out public unrest..
«No problem now, but that’s only because there is no answer now», – considers Billy Weber, CEO of Checkpoint Capital, Fixed Income Platform.
Index S&The P 500 has risen 48.8% during the Trump administration, which he has often referred to as his criterion for success..
On the political front, the Trump administration has focused on tax cuts, deregulation, and rethinking US stance on global trade agreements to spur domestic production..
However, the financial industry hasn’t always liked Trump. He attacked corporate executives, including the CEO of JPMorgan Chase & Co Jamie Dimona, and close Wall Street associates distanced themselves from Trump when he was criticized for his actions over the pandemic and protests against racial justice.
Biden called for higher corporate taxes, tighter regulation, and a less aggressive stance with trading partners. The financial industry is also worried about tough law enforcement and consumer controls that Trump has loosened..
The former vice president described himself as the man who will unite the country and has joined the progressive supporters who have fiercely criticized Wall Street. But many CFOs said they were more worried about the second wave of chaos from the Trump administration..
Regardless of the identity of the winner, the decisive outcome will be the key to giving Wall Street the confidence it craves, said David Boyes, who represented the vice president Elah Gora in a U.S. Supreme Court case, which resulted in George Bush was elected to the White House.
However, some young Republican financier leaders said they look forward to meeting to celebrate Trump’s swift victory..
Charles Colean, The 25-year-old investment industry worker who raised money for months to celebrate Trump’s re-election said he reserved a section of a bar in Dallas where he and about 100 of his friends planned to toast to the president..
«The perfect storm is looming to make Donald Trump president for two terms», – he said.