Hilary Clinton takes the lead in the Presidential race with Donald Trump being labelled 'unfit to be President' by Barack Obama. The stock market could hold the key to who is likely to win in November.
Hilary Clinton appears to have once again taken the lead in the race for the White House, after the Democratic convention in Philadelphia on Monday night. A recent CNN poll has put Clinton at 52% vs. Trump at 43%, with the remainder choosing neither. Donald Trump has been labelled as ‘unfit to be President’ by Barack Obama, and many other Republicans have refused to support him after his recent comments on Women and Muslims have sparked outrage.
Market analysts have suggested that following stocks may be a good indicator of who will win Presidency: If US stocks rise from 1st August to 31st October, it could be more likely that Clinton will win, and if they slide in the same period, Trump could be the likely winner. This has been based on analysing data in the lead up to every presidential election since 1944, whereby if stocks rose, 84% of the time the current party in the white house has won. Simply, if the economy is growing, voters are far more likely to want to keep it that way.
Data releases which may affect Dollar exchange rates in the immediate future include Markit Services PMI for July, released this afternoon, which will provide an insight into conditions within the services sector. Initial Jobless Claims for the last week is released tomorrow and is expected to show a fall from the previous week, and then on Friday we will see the latest Non-Farm Payroll figures and Unemployment rate.
New York Federal Reserve President, William Dudley, hinted on Monday towards hiking rates sooner than markets are expecting, and if this week’s key data releases show signs of positivity, could further bolster his argument for a raise. With this in mind, combined with an increased likelihood of an Interest Rate cut from the Bank of England on Thursday, we could see GBP/USD rates move below 1.30 providing another excellent opportunity for Dollar sellers.
Thank you for reading today’s US market report, Feel free to call our trading floor on 01494 725 353 if you have a currency transfer to make, our brokers are happy to assist you.
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