He first debate from the presidential race to the White House is here. The candidates for the November 3 elections, Donald trump Y Joe biden, they face this Tuesday in what is the most anticipated 'face to face', especially by the markets. Investors are getting more and more nervous about what might happen on this date at the polls, and they hope to find some relief in the duel. Although the experts agree: it will not matter what the Republican or the Democrat say, but who wins.
In fact, as analysts comment, the reaction of investors in the following hours will be based more on the perception of which candidate has emerged victorious from the debate than on the very essence of what Trump or Biden say on certain topics, such as the taxes, the Covid-19 pandemic wave trade war with China.
"The debate may not see an immediate reaction per se, although where you can see it is in the data from the polls after the debate," they comment from RiverFront Investment Group, as collected Marketwatch. That is, if this 'head-to-head' show that Biden's lead so far over Trump is narrowing or widening. Although it is something that may take a few days, so it is possible that the response of the markets will wait.
History shows that markets do not usually see excessive movements after the first discussions, which as a general rule are the most seen in the field. So much so that in the electoral years since 1960 in which there have been duels between candidates, the average movement of the S&P 500 the next day it was down -0.14%, according to Dow Jones Market Data.
"Unless Biden has a big blunder, no big turnaround in the polls is anticipated. Biden still has strong control in troubled states, but the Senate remains the big question mark," Oanda analysts say. one of his latest market comments.
The democrat has before him a great opportunity that has given him the New York Times, which has accused Trump of tax evasion for the past 15 years. Experts believe that Biden will not waste it and will attack his rival with this information that, as expected, has been described by the US president as 'fake news'. However, they also warn about the latest occurrence of Trump, who has demanded that a drug test be carried out on the candidates before the debate.
In addition, it should not be forgotten that this television 'face to face' occurs at a time when investors are very nervous from the perspective of possible problems with vote counting. It is estimated that due to the coronavirus there will be a significant increase in absentee ballot, which can bring added difficulties to the process. This was recently warned by Goldman Sachs: "The complications involved in counting votes by mail can cause the counting period to be extended after election day," and that could add more uncertainty if possible to the markets.
THE SUPREME CAN BE KEY
Especially because it worries that the result remains in limbo for weeks. Many experts believe that this has been the cause of the rebound in market volatility in September, as stocks have retreated from their all-time highs. Although the situation may become even more complicated if Trump confirms his threats, because he has said that if Biden wins, he is not willing to make the transition easy.
Specifically, it has ensured that its intention is bring the democrat before the Supreme If you lose the election, as you believe that voting by mail, which will become one of the centerpieces of these elections due to efforts to reduce the spread of Covid-19 by limiting voting in person, could undermine the outcome given that it poses a widespread fraud risk.
That is why Trump has rushed in his latest move, and has nominated the judge Amy Coney Barret to replace the recently deceased Ruth Bader Ginsburg on the Supreme Court. His intention is to speed up the process as much as possible so that his candidate occupies the position before the day of the elections, since there is the possibility, as some polls point out, that Republicans lose more than one senator along the way, which it would complicate Trump's aspirations. If the Senate confirms Barrett, that would cement the Supreme Court's shift to the right, which in turn could pave the way for the US President if Biden wins and decides to take the results to court.