Baker & Co Financial Solutions Ltd

Thoughts from F&C Multi Manager team to the US election result.

November 9th, 2016 by Baker and Co

We are likely to see market volatility extend over a period of time, though much like with the Brexit shock, rallies are also likely in some areas. We are facing a sharp sell-off today but the longer-term outcomes are less obvious. Markets always adjust over time, though the probability of significant shifts in domestic and foreign policy will have consequences, as will the lack of certainty and predictability associated with Donald Trump’s policy agenda. Political volatility and policy uncertainty will remain elevated for some time. The US will certainly be a different nation under Trump, acting more in its own interests, with consequences for NATO, trade agreements, climate change agreements and the established geopolitical order. From a domestic point of view, higher fiscal spending could be supportive for the economy though this will increase the debt burden and any boost to domestic growth could be offset by lower trade to some extent.

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