Investors Bet Big on a Trump Presidency: Sector Impacts and Market Volatility

New York City, New York United States of America
Energy sector could benefit from increased fossil fuel production under Trump.
Goldman Sachs predicts a 70% chance of Trump winning elections.
Investors are betting on a Trump presidency with renewed interest.
Reductions in fuel efficiency standards, environmental permits, financial regulations, and internet provider rules possible under a second Trump term.
Investors Bet Big on a Trump Presidency: Sector Impacts and Market Volatility

Investors are showing renewed interest in the so-called 'Trump trade,' as the November elections approach and the probability of a Donald Trump victory increases. This market phenomenon refers to investments based on potential impacts of a Trump presidency on various sectors, including stocks, bonds, and commodities.

According to Goldman Sachs, there is a 70% chance that Trump will win the November elections. If this prediction holds true, investors can expect several changes under a second Trump term. For instance, there may be reductions in rules for vehicle fuel efficiency standards, environmental permits, financial regulations, and internet providers.

Historically, rates have fallen six months before voting day but are then followed by uncertainty. However, this trend might not hold true this time around due to the heightened political tension and market volatility.

One sector that could benefit from a Trump presidency is the energy sector. Trump has indicated his intention to increase production of fossil fuels, which could make energy giants like Exxon significant gainers. Additionally, private prison stocks such as Geo Group have risen due to Trump's talk of rounding up immigrants and putting them into detention.

The stock market has already shown signs of reacting to Trump's public pronouncements. For example, his comments about increasing tariffs on China led to a sell-off in semiconductor, AI, and other large tech companies. However, it is important to note that the markets are influenced by various factors and cannot be solely attributed to political events.

It is crucial for investors to remain informed about the potential impacts of a Trump presidency on their investments. By staying up-to-date with market trends and economic indicators, they can make informed decisions and mitigate risks.


Article Image
Article Image
Article Image
Article Image
Article Image
Article Image
Article Image
Article Image

Confidence

85%

Doubts
  • The accuracy of the Goldman Sachs prediction for Trump winning elections.
  • The extent to which Trump's policies will actually be implemented.

Sources

81%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Investors are putting their money on the "Trump trade." Here's what that means.

CBS News Site: https://www.cbsnews.com/articles/about-us/ Kate Gibson Saturday, 20 July 2024 21:09
  • Unique Points
    • Investors are placing bets on the 'Trump trade', which refers to market moves based on the potential impacts of a Trump presidency on the U.S. economy, stock prices, and individual industries and companies.
    • Companies that mainly do business within the U.S., as opposed to global players, could benefit from Trump's plan to impose universal tariffs on U.S. imports.
    • If re-elected, Trump has indicated his intention to increase production of fossil fuels, which could make energy giants like Exxon significant gainers.
    • Private prison stocks such as Geo Group have risen due to Trump's talk of rounding up immigrants and putting them into detention.
    • Trump's public pronouncements have already started moving financial markets; for example, his comments about increasing tariffs on China led to a sell-off in semiconductor, AI, and other large tech companies.
  • Accuracy
    • Companies that mainly do business within the U.S., as opposed to global players, could benefit from Trump’s plan to impose universal tariffs on U.S. imports.
    • Investors believe that a second Trump presidency could be beneficial for cryptocurrencies, as Trump has recently shown support for digital currencies and his running mate, Ohio Senator J.D. Vance, has been a proponent.
    • A blanket 10% tariff on all US imports could apply under a Trump administration which would hit the global economy and US consumers.
  • Deception (30%)
    The article contains selective reporting and sensationalism. The author quotes experts warning about potential negative economic implications of a Trump presidency, but fails to mention any counterarguments or opposing viewpoints. This creates a biased and one-sided perspective on the issue. Additionally, the title of the article, 'Investors are putting their money on the
    • Examining causes of American voters’ anger with the economy
    • For example, Trump’s plan to impose universal tariffs on U.S. imports would likely benefit companies that mostly do business here at home.
    • Investors also think Trump’s return to the White House would mean less regulation, a potential tailwind for heavily regulated sectors such as banking and energy.
    • On Friday, shares of crypto-related stocks rose even as the overall market fell.
    • The so-called Trump trade “has to do with those companies viewed as being the primary beneficiaries of a Trump presidency and the agenda he has laid out so far.”
    • Wall Street has dubbed such market moves the “Trump trade.”
    • Another area that investors think has upside in a second Trump presidency is cryptocurrencies.
    • As former President Donald Trump stretches his lead at the polls over President Joe Biden, investors are already laying bets on what Trump’s return to power could mean for the U.S. economy, stock prices, and individual industries and companies.
  • Fallacies (85%)
    The author makes an appeal to authority when quoting Goldman Sachs analysts and JJ Kinahan. The author also uses inflammatory rhetoric by stating that Trump's plan to impose universal tariffs on U.S. imports would likely cause a 'flare-up in inflation'.
    • A Trump presidency would bring 'important macro and market implications, with the key impacts likely revolving around trade policy and tariffs.', Goldman Sachs analysts said in a report.
    • The things that get said and proposed on the campaign trail are often difficult to put into place once you get to 1600 Pennsylvania Avenue.', Art Hogan, chief market strategist at B Riley Wealth, also sounded a cautionary note.
    • Trump moving markets. Trump's recent comments about jacking up tariffs on China and requiring Taiwan to pay for U.S. military protection this week triggered a sell-off in semiconductor, AI and other large tech companies.
    • The political rhetoric during this political climate and Beltway races will be loud but, ultimately just like our view since 2016, the bark will be way worse than the bite on the U.S./China Cold Tech War fears.
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

97%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Trump Trade Sees Investors Snap Up Junk Debt and Industrials

Bloomberg News Now Tasos Vossos, Saturday, 20 July 2024 21:09
  • Unique Points
    • Investors are buying American high-yield bonds in the credit world’s version of the ‘Trump trade’.
    • Spreads on US high-yield bonds have strengthened compared to their euro counterparts recently.
    • Junk funds globally have seen a surge in inflows.
  • Accuracy
    No Contradictions at Time Of Publication
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

80%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

The Trump trade: Market impact on stock, bonds, commodities

Business Insider Laila Maidan Saturday, 20 July 2024 21:12
  • Unique Points
    • A Trump victory in the November elections is predicted with a 70% probability according to Goldman Sachs.
    • Goldman Sachs expects a reduction of rules for vehicle fuel efficiency standards, environmental permits, financial regulations, and internet providers under a second Trump term.
    • Historically, in the six months leading up to voting day, rates have fallen but were then followed by uncertainty.
  • Accuracy
    • Investors and traders have been making sector-specific bets in anticipation of a Trump win, specifically in real estate, traditional energy, financials, and industrials while dumping renewables and utilities stocks.
    • A blanket 10% tariff on all US imports could apply under a Trump administration which would hit the global economy and US consumers.
  • Deception (40%)
    The article provides a detailed analysis of how different sectors of the stock market could be impacted by a Trump presidency. It discusses potential changes in policy areas such as deregulation, tariffs, taxes and monetary policy. However, it does not disclose sources for some of the claims made about potential impacts on specific sectors or provide any empirical evidence to support these claims.
    • The presidential debate, which proved disastrous for President Joe Biden, showed some sector-specific bets investors made in anticipation of a Trump win. Investors opted for real estate, traditional energy, financials, and industrials while dumping renewables and utilities stocks.
  • Fallacies (85%)
    The article contains several informal fallacies. It reports on predictions and speculations about potential market reactions to a Trump victory without clearly distinguishing between them and the author's own opinions. For example, it cites prediction markets, UBS, Goldman Sachs, and Morgan Stanley without consistently differentiating their forecasts from the article's own assertions. Additionally, there are several instances of appeals to authority in which the article relies on expert opinions to support its speculations about potential market reactions under a Trump administration. The author also uses inflammatory rhetoric when describing the potential impact of a Trump presidency on various sectors, such as referring to 'sector-specific bets investors made in anticipation of a Trump win' and stating that 'a more obvious play sent shares of Trump Media and Technology Group (DJT) up by 31% on Monday.'
    • As prediction markets assign a 70% probability of a Trump victory, according to a July 17 note from Goldman Sachs.
    • Investors opted for real estate, traditional energy, financials, and industrials while dumping renewables and utilities stocks.
    • A more obvious play sent shares of Trump Media and Technology Group (DJT) up by 31% on Monday.
  • Bias (95%)
    The author expresses political bias by stating the prediction markets assign a 70% probability of a Trump victory and describing how investors are betting on his win. She also mentions that political speculators and investors alike are making outlooks based on their expectations of a Trump win, indicating her own expectation or belief in a Trump victory. The author also expresses her opinion that if Trump wins, he will need a red wave (Republicans winning majorities in both chambers of Congress) to increase the chances that his agenda passes without friction.
    • Goldman lists tariffs, taxes, and regulation as central. Policy A deregulation agenda is top of mind under Trump’s leadership.
      • If Trump wins, investors will need to cut through the noise and at least understand how he might impact different parts of the economy.
        • Political speculators weren’t the only ones throwing money at their expectations. Investors and traders alike took their outlooks to the stock market.
          • Prediction markets assign a 70% probability of a Trump victory, according to a July 17 note from Goldman Sachs.
          • Site Conflicts Of Interest (100%)
            None Found At Time Of Publication
          • Author Conflicts Of Interest (100%)
            None Found At Time Of Publication

          97%

          The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
          (Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

          A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

          Here's an update on all 34 portfolio stocks, including the winners in a Trump presidency

          CNBC News Morgan Chittum, Wednesday, 17 July 2024 20:29
          • Unique Points
            • Jim Cramer's Charitable Trust portfolio was discussed during the July Monthly Meeting
            • The analysis focused on how a Donald Trump victory in the November election would impact the stocks in the portfolio
          • Accuracy
            No Contradictions at Time Of Publication
          • Deception (100%)
            None Found At Time Of Publication
          • Fallacies (100%)
            None Found At Time Of Publication
          • Bias (100%)
            None Found At Time Of Publication
          • Site Conflicts Of Interest (100%)
            None Found At Time Of Publication
          • Author Conflicts Of Interest (100%)
            None Found At Time Of Publication