U.S. stocks rose during a volatile Election Day session, with indexes climbing and the Russell Index (small-cap index) outperforming. All sectors finished trading in positive territory, led by Consumer Discretionary, Industrials, and Utilities, while Materials, Energy, and Staples lagged.
In the bond markets, U.S. Treasuries experienced a sell-off, while the U.S. Dollar Index surged in the Forex market as investors priced in the likelihood of a Donald Trump victory, leading to a significant decline in the Euro index.
Performance of Different Asset Classes:
– Indices:
– S&P 500: +2.25%
– Dow Jones: +2.97%
– Forex:
– Dollar Index (DXY): +1.79%
– EUR/USD: (-2.04%)
– Commodities:
– Gold Spot (XAU): (-1.53%)
– Silver Spot (XAG): (-2.86%)
– U.S. Treasury Yield:
– 10-Year Treasury: (-1.03%)
Quick Note on Commodity Markets:
Oil prices are trading in a narrow range, with pullbacks in both U.S. and U.K. crude. Gold declined as investors’ risk appetite increased, along with a stronger U.S. dollar. Silver followed gold’s prices due to their positive correlation.
This week, the Federal Reserve is set to announce its interest rate decision, with attention focused on whether Chairman Jerome Powell will adjust the tone of monetary policy following Trump’s election victory. The current U.S. interest rate stands at 5%, and markets anticipate a 0.25% rate cut. However, the market could experience significant volatility based on Powell’s remarks, especially if they indicate whether the Fed will continue its easing stance or adopt a more cautious approach by holding rates steady.
