Trump's victory inflicts the enthusiasm of the markets ... and now the right test begins

Donald Trump’s victory in the US presidential election in November caused an immediate wave of heights in the market; When the shares jumped, the dollar rose, and it ‘formed’ record profits. But only two months later, and with the Republican president approaching the White House, only a few profits managed to resist. The first signs of decline in the stock market have appeared, as the ‘S&B 500’ index has abandoned a large part of the ‘Trump trading’ profits, with investors questioning the expected interest cut of the ‘Federal Reserve’ and the implications of new management policies on share prices. Treasury yields have also been a sharp rise since the end of November, after the difference between short and long yields has diminished. On the other hand, the dollar maintained and formed their profits. But the right test of these bets is now starting at Trump’s office. Customs duties are the greatest risk; As it raises the fear that the upcoming administration plans could lead to longer and more volatile commercial wars than it was during its first term. The Wall Street professionals are also concerned about the impact of any migration measures on the US economy, as well as escalating geopolitical tensions, especially with Trump already targeting some of America’s traditional allies, such as Canada, Mexico and Europe. “The expectations are the way to say that we guess, but we have to make assumptions about these policies because it will affect the economic outlook,” said Andrew Holinhur’s chief economist at City Group, in a call at 2025. Read more: Posting: Trump’s policy will quickly look at US shares and the dollar in 2025. Stock market, such as companies with small capital. The Russell 2000 index jumped by 5.8% the day after the election and achieved its best session in two years. The logic behind this was simple: The policy of the upcoming management trade will benefit businesses that achieve most of their income locally. But the enthusiasm soon faded. After the index jumped by 8% between 5 and 25 November, most of these profits were wasted in the following weeks. “Many of these stocks barely earn profit or even losses, and they depend on financing to continue, and high interest rates harm this novel,” says Steve Sosnik, the most important strategy at interkev Brokers. The shares of banks, in turn, saw madness after the election, as Trump promised to alleviate the regulatory regulations on the money shooters. KBW Bank jumped by about 14% between 5 and 25 November, as it reached its highest level in 52 weeks. But the momentum later faded, as the index fell 1.8% by Friday. The shares of energy businesses also received a boost after the election due to Trump’s position to support the increase in oil and gas production. The energy index within the “S&B 500” increased by 3.5% on November 6, which achieved its best session in a year, and rose 6.5% from the election day to November 22. Subsequently, the shares had serious fluctuations, which fell 3.2% due to the fear of excess offer, customs duties and economic growth. As for the betting that survived the stock market, they were in areas where investors enjoyed some relative clarity. Arrows associated with cryptocurrencies have largely maintained their profits. Tesla has also emerged strongly as it has risen 70% since Trump’s victory, although he is known for his doubts about the issue of electric cars. The dominant idea focuses on the fact that the proximity to Elon Musk of the new administration will support the company’s ambitions in the manufacture of self -managed cars. “Nothing has almost a bet after the election in the shares except for cryptocurrencies.” Read more: Mask’s bet on Trump adds $ 572 billion to the value of “Tesla” currencies that embodied the clearest image of the “Trump Trade” wave before the election, supported by acute customs and the possibilities of inflation as a result of the most facilitated financial policy of the Trump administration. The Bloomberg index for the dollar has risen by 5% during the ten weeks since the election day, which is similar to what it achieved after Trump’s 2016 victory. This rise supports the opposite weakness in global currencies at risk due to Trump’s economic policy, including the euro and the Canadian dollar. Wall Street expected a lot to this step. JP Morgan analyst Mira Shandan and her team expected the euro to weaken to the level of a draw as Trump’s victory, while Sky Lar Montgomery, the currency strategy in Barclays Capital, said the Canadian dollar could drop to the levels of the pandemic era. The Shandan team now expects the euro to trade below a level level during this term. “I think customs duties have not been fully taken into account,” Chandan, head of global currency strategies at JP Morgan, said in a sound blog recently. Most of the emerging market currencies saw weakness after Trump’s victory. The MSCI index has fallen by 2.2% since the election day, as Rand South Africa and European currencies have led this decline. As for the Mexican Bezo, which was the preferred currency of the traders to bet before the vote before the vote, it has been 3.4% against the dollar since the election, but it was relatively the best performance compared to most of its 31 peers the most important currency that Bloomberg monitors were. The relative bizo steadfastness is due to postponing their expectations on reducing interest by the “Federal Reserve”, which has urged the policymakers in Mexico to be careful. In China, the yuan has dropped by more than 3% against the dollar in local and international trade since November 5, due to the risk of customs duties and the larger gap between the returns of the US and Chinese government bonds. The Chinese People’s Bank has used several tools to support the currency, and its expectations have decreased since its peak in early December. Read more: Currency traders who bet on the market fluctuations during the Trump -era of interest rates, Trump’s victory, not to mention Republicans’ control of the Senate and the House of Representatives, would increase the intensity of the decrease in the curve of the mortgage, based on policies that believe it leads to inflation. This is what is already happening, as the gap between Treasury effects has expanded ten years and two years to about 34 basis points, and it has been close to the most serious slopes since the beginning of 2022, while long -term tires fell before Trump’s inauguration. “We see the beginning of a drop in curves. The fact that the Federal Reserve has lowered the interest rate by 100 basis points, however long returns have increased, you said that many of these movements had already taken place in the market,” said Neil Sarland, director of the Governor at the Schroeders for Investment Administration. The strong US economic data and the uncertainty about Trump’s policy also influenced the short -term interest rates. Currently, traders only expect two reductions by a quarter point for each discount of the “Federal Reserve” this year, compared to about six discounts they expected before the election. However, the only certain thing in the market is now the uncertainty. This is what the interest rate dealers felt last week, when the monthly inflation report, which became weaker than expected, led to a sharp decline in connections of different times. “Right now, morale in the bond market is very negative, and the risk exists that the yields can reduce more,” says Sarland. Read more: Trump’s victory supports US stock indicators, the dollar and the revenue of the cryptocurrencies, Trump, who previously questioned cryptocurrencies and describes “deer” as “as fraud”, can change position, and is now with strong support from the coding currency sector. According to reports of “Bloomberg”, with a view to the opinion, Trump is planning to issue an executive order that makes cryptocurrencies a political priority, giving actors in this area a role within his administration. It is also expected to reduce organizational restrictions and establish a strategic reserve of “Bitcoin”. As expected, encrypted assets have seen a remarkable increase since the election. Bitcoin reached a record level mid -December and achieved about 50% compared to the price on November 5. As for the ‘Bloomberg Galaxy Curricula’ index, it rose with 11% on the next day of the election, and since then 29% gains added.