Trump’s election win dominated price action on Wednesday, sending most of the major assets to notable highs and lows.
How did your favorite assets trade yesterday?
We have the deets:
Headlines:
- Trump’s projected election win sent the U.S. dollar, Treasury yields, and equities sharply higher
- Germany factory orders jumped from -5.4% to 4.2% m/m in September; August reading revised from -5.8%
- Spain services PMI for October: 54.9 (56.6 expected, 57.0 previous)
- Italy services PMI for October: 52.4 (50.3 expected, 50.5 previous)
- France final services PMI revised higher from 48.3 to 49.2 in October
- Germany final services PMI upgraded from 51.4 to 51.6 in October
- Eurozone final services PMI revised higher from 51.2 to 51.6 in October
- U.K. construction PMI for October: 54.3 (55.3 expected, 57.2 previous)
- Eurozone PPI for September: -0.6% (-0.5% expected, 0.6% previous)
- Canada IVEY PMI for October: 52.0 (54.2 expected, 53.1 previous)
- EIA: U.S. crude oil inventories rose by 2.1M barrels in the week ending November 1 (+0.3M expected, -0.5M previous)
Broad Market Price Action:
Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView
Donald Trump’s big win in the 2024 presidential election set off a broad market rally, with U.S. stocks hitting record highs and bitcoin soaring to an all-time high above $76,000 on hopes for crypto-friendly policies.
The anticipation around Trump’s fiscal moves (read: tax cuts and increased government spending) pushed the 10-year Treasury yield up to 4.44% and lifted the U.S. dollar index, signaling expectations of stronger growth and inflation.
With the dollar on the rise and yields climbing, gold took a hit, seeing its biggest one-day drop since June 2021, down to $2,660. Meanwhile, WTI crude oil swung widely before settling at $71.78, as traders weighed Trump’s energy policies against a stronger dollar and higher U.S. inventory data.
FX Market Behavior: U.S. Dollar vs. Majors:
Overlay of USD vs. Major Currencies Chart by TradingView
The U.S. dollar showed strong bullish momentum after Trump’s election win, kicking off with an initial surge during the Asian session. The rally really picked up steam in the European session, with EUR/USD sliding 1.78% as European traders priced in the impact of Trump’s victory.
By the time U.S. markets opened, the momentum had eased, and we saw more nuanced moves across currency pairs. USD/CAD, for example, held up relatively well with a 0.86% gain, as commodity prices and regional economic factors started to play a bigger role once the initial election reaction cooled down.
Upcoming Potential Catalysts on the Economic Calendar:
- Germany industrial production at 7:00 am GMT
- Germany trade balance at 7:00 am GMT
- U.K. Halifax HPI at 7:00 am GMT
- Eurozone retail sales m/m at 10:00 am GMT
- BOE monetary policy decision at 12:00 pm GMT
- BOE Gov Bailey presser at 12:30 pm GMT
- U.S. initial jobless claims at 1:30 pm GMT
- U.S. preliminary unit labor costs at 1:30 pm GMT
- BOC member Kozicki to give a speech at 2:00 pm GMT
- FOMC statement at 7:00 pm GMT
- FOMC Gov. Powell speech at 7:30 pm GMT
- Japan household spending at 11:30 pm GMT
Germany’s industrial production and trade balance data, along with Eurozone retail sales, could set the tone for the European session, while traders will closely watch the BOE’s policy updates and speeches for any GBP-related volatility.
In the U.S., jobless claims, productivity data, and the highly anticipated FOMC’s rate decision and statement are likely to drive major moves, especially with expectations around potential shifts in monetary policy plans after Trump’s election.
Don’t forget to check out our brand new Forex Correlation Calculator when taking any trades!
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