Global markets under Trump: Build the Wall (Street)!... and China
By Marc Jones LONDON (Reuters) - Donald Trump's campaign slogan in 2016 could have been 'build the Wall Street’, but a scan across global markets throws up plenty of surprises, especially in the emerging economies that have been in Trump's cross-hairs.
By Marc Jones
LONDON (Reuters) - Donald Trump's campaign slogan in 2016 could have been 'build the Wall Street’, but a scan across global markets throws up plenty of surprises, especially in the emerging economies that have been in Trump's cross-hairs.
While the numbers may have been exaggerated by this year's COVID-19 crisis, most analysts agree that Trump's tax cuts, combined with low interest rates and the online boom, have made Wall Street a winner over the last four years.
UniCredit's chief economist, Erik Nielsen, highlights how the S&P 500 <.SPX> has delivered a 65% total return over Trump's term compared with a dismal 14% for Europe's STOXX 600 <.STOXX>.
Boosted by the pandemic this year, the tech-skewed Nasdaq has done even better. It is up a whopping 110%, led by a stratospheric 285% leap by the 'FAANGs' quartet of Facebook, Amazon, Apple, Netflix and Google, that has also driven the value of world stocks up $15 trillion (£11 trillion).
Wall Street's run has been "impressive" said Hans Peterson, global head of asset allocation at SEB investment management.
Trump's tax cuts have helped somewhat, "though it has really been a combination of things that have worked for American companies", such as low rates and business models that have led to stronger earnings, he said.
(GRAPHIC: Global markets since Trump's election - https://fingfx.thomsonreuters.com/gfx/mkt/jbyprxazdpe/Pasted%20image%201604321715307.png)
The other star market of Trump's presidency, however, is certainly not linked to his policies.
MSCI's China equity index has jumped the same 65% as Wall Street, thanks to its own tech titans and Beijing's stimulus that offset the hundreds of billions of dollars of U.S. trade tariffs the agitating White House has put in place.
China's currency, the yuan
Other emerging markets that were initially in Trump's cross-hairs have had a much rougher ride, although in many cases it has been COVID-19 that has done the real damage, as has been the case with oil
(GRAPHIC: Emerging market currencies since Trump's election - https://fingfx.thomsonreuters.com/gfx/mkt/gjnpwloqbvw/Pasted%20image%201604321158585.png)
WALLS AND WORRIES
The moves have cascaded through EM equity and debt markets too. Russian stocks are exactly where they were back in 2016 in dollar terms, whereas Mexico's and Turkey's equivalent indexes are down 35% and 55% respectively.
Russian dollar-denominated bonds have made holders a stellar 33% total return over the last four years despite various wobbles around sanctions and investigations of Trump's links to Moscow.
That is better than the near 20% earned by U.S. Treasuries, German bunds and corporate credit.
"It (Russia) has been one of best fiscal stories out there," said Aberdeen Standard Investment portfolio manager Viktor Szabo.
But "over the past couple of days the rouble's performance has been even worse than the lira's, which is saying something," he added, linking it to concerns Biden could take a tougher line on Russia.
Venezuela's bonds are at the opposite end of the spectrum. They have shown some signs of life in recent weeks after becoming almost worthless after Trump's administration sanctioned https://uk.reuters.com/article/us-venezuela-markets-jpmorgan/jp-morgan-cuts-venezuela-debt-from-popular-bond-benchmarks-idUKKCN1U41KX them in early 2019 in a bid to force President Nicolas Maduro and his allies from power.
Mexico's peso has also been climbing again, on hopes that it will not face the same kind of border worries should Biden win.
"With these U.S. elections, not all emerging markets are the same," said Manik Narain, head of EM strategy at UBS.
(GRAPHIC: How emerging market stocks have done since Trump's election - https://fingfx.thomsonreuters.com/gfx/mkt/ygdpzngznpw/Pasted%20image%201604320281825.png)
(GRAPHIC: Major world stock indexes over the last four years - https://fingfx.thomsonreuters.com/gfx/mkt/ygdpznlwmpw/Pasted%20image%201604338194330.png)
(GRAPHIC: World stocks market cap rise over last four years - https://fingfx.thomsonreuters.com/gfx/mkt/bdwpkjmoovm/Pasted%20image%201604323646730.png)
(Reporting by Marc Jones; Editing by Dan Grebler)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.
By Johannes Hellstrom, Bart H.
By Medha Singh and Shivani Kumaresan (Reuters) - Wall Street gained on Friday as Disney and Cisco's upbeat results brought the focus back to corporate earnings at the end of a volatile trading week that saw record surges in coronavirus cases and increased hopes of a working vaccine.
By Sumita Layek (Reuters) - Gold gained as much as 1.1% on Friday as rising global coronavirus infections re-ignited concerns about the economic toll from the pandemic, while scepticism over the reach of a potential COVID-19 vaccine further boosted the safe-haven metal. Spot gold rose 0.8% to $1,890.81 per ounce by 11:33 a.m