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The upcoming U.S. election could significantly impact commodity markets, with Kamala Harris's potential victory likely boosting demand for industrial metals and renewable energy materials due to increased infrastructure spending. Conversely, a Trump re-election may favor fossil fuels and deregulation, affecting supply and prices. Both scenarios could influence the U.S. dollar's strength, further impacting commodity prices.
IG
The outcome of the US elections could significantly impact commodity markets, with a Kamala Harris win likely boosting demand for renewable energy commodities like copper and lithium, while reducing reliance on fossil fuels. In contrast, a Trump re-election may favor traditional fossil fuels through deregulation and increase demand for industrial metals due to infrastructure spending. Both scenarios could influence precious metals as geopolitical uncertainty drives demand for safe-haven assets like gold, alongside fiscal and monetary policies affecting the US dollar and commodity prices.
IG
US indices are set for historic gains, with the S&P 500 and Dow Jones on track for their best run since late 2023. The ASX 200 reached a record high, driven by strong bank performance, while key economic indicators showed positive trends in retail sales and job growth.Looking ahead, significant events include the Reserve Bank of Australia's speech and the release of various PMIs in the US, Europe, and Japan, alongside the third-quarter earnings season featuring major companies like Tesla and Boeing.
IG
Institutional investors are increasingly worried about the U.S. national debt, which is projected to exceed $1.9 trillion, raising concerns about its impact on portfolios amid high interest rates and geopolitical tensions. A recent survey revealed that central bank policies and macroeconomic risks are top concerns, with many institutions reassessing their fixed income strategies. The rising debt levels are not just a U.S. issue but a global phenomenon, prompting scrutiny of fiscal policies worldwide.
The outcome of the US elections could significantly impact financial markets, with Trump favoring traditional sectors like oil and defense, while Harris would boost renewable energy and healthcare. Trump's policies may lead to volatility and inflation, whereas Harris could stabilize markets with a more moderate approach. Investors must adapt their strategies based on the election result, as each candidate presents distinct opportunities and risks.
IG
Donald Trump is making a series of tax cut promises as the presidential election approaches, including exemptions for overtime work, retirement benefits, and tax-deductible interest on car loans. While these pledges aim to attract voters, they raise concerns about increasing the fiscal deficit and complicating the tax code.
Policymakers in the U.S. and China are taking decisive steps to bolster economic growth, with the Fed initiating an easing cycle and China committing to support consumers. This shift in strategy signals a potential revival in private sector confidence, despite ongoing risks. Asset allocation is adjusting, favoring emerging markets and Asian credit, while U.S. Treasuries are downgraded. Caution remains due to geopolitical uncertainties and the possibility of disappointing Chinese policy outcomes.
UBS has initiated coverage on Antero Resources with a Neutral rating and a price target of $33, highlighting its strong inventory and higher realized prices compared to peers. However, concerns about balance sheet leverage, with a net debt to EBITDA ratio of 1.6, may delay returns on capital until late 2025. Despite a mixed financial outlook, the company has reduced debt by $2 billion since 2019 and is positioned for potential market recovery.
The Russell 2000 has reached a new annual high, outperforming the S&P 500 by over 4% since last Friday, driven by positive bank earnings. Technical indicators suggest a bullish trend, with the index surpassing its July peak of 2,275 points, targeting 2,450 points next. The upcoming US presidential elections could further influence this momentum, particularly with a potential Trump victory favoring regional banks.
IG
A split Congress with Trump as president could lead to higher tariffs and lighter regulations, benefiting financials but creating mixed impacts on equity markets. While the dollar and interest rates may rise, inflationary pressures could complicate Fed rate cuts, particularly affecting consumer discretionary and technology sectors. The fossil fuel industry might see reduced regulatory risks, while green energy initiatives could face funding cuts.
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