Recapping an Eventful (US) Election Week

This week brought significant developments south of the border. Donald Trump secured victory as the 47th President of the United States.

Market Reactions

US equities rallied as investors anticipated corporate tax reductions. Bond prices declined as analysts suggested the Federal Reserve might resist rate cuts. The US dollar strengthened on expectations of robust economic growth. Energy stocks surged following promises to eliminate restrictive climate regulations.

Election results have minimal impact on financial market performance in the medium to long term, with economic fundamentals driving returns rather than political outcomes.

Interest Rate Developments

The Federal Reserve implemented a 0.25% rate reduction, bringing cumulative cuts to 0.75% from peak levels. The Bank of England also cut rates by 0.25%, reflecting synchronized global monetary easing.

Our portfolio strategy emphasizes US equity preference over global markets while remaining diversified. Fixed income instruments now offer compelling alternatives to cash as rates decline.