“The opposition occupies the benches in front of you, but the enemy sits behind you.”
— Attributed to Winston Churchill
For the full dashboard, please click on ‘Download’ below:
Well, that went well, President Trump must be thinking right now. As per time of writing this letters (07:32), it looks like the Democratic party in the US not only gained the House, but also the Senate:
Most (or at least more) importantly, did the Dems gain some of the Republican strongholds, such as Texas or Michigan.
Markets (equity futures) reacted at first with a SEA OF RED to the WAVE OF BLUE, but have since then recovered and are nearly back to where they left off at yesterday’s closing bell.
Talking about the closing bell, some very strong results were reported after-market hours by AI-bellwether Advanced Micro Devices (aka AMD), which may give an important tailwind to the AI trade today.
Working against that, and probably the reason for the initial sell-off during early market hours, was the recognition that James Talarica, a Democrat, would win the Texas Senate race. Texas is, of course, the epicentre of AI data centres (pun intended).
Plus, a Democratic Congress probably doesn’t mean more regulation, but could well hamper further deregulation.
This was immediately reflected via a sell-off in the KOSP(A)I index, but recovery is following after the initial shock:
Another early ‘victim’ of fears of a possible slowdown in deregulation was Bitcoin, albeit investors seems to have changed their minds on that already again:
Other asset classes’ reactions?
US 10-year Treasury yields are trading in the middle of a wild and wide (10 bp) trading range since yesterday afternoon:
But maybe more noteworthy is that precious metals are recovering strongly too after some initial weakness:
Gold (upper clip( has worked its way back above key support and Silver (lower clip) is trying hard to achieve the same:
Ok, I am sure there is much more, but let’s leave it at this for now. In case anything earth-shattering portfolio-shattering happens, I may follow up with a midday letter. If not, speak to you tomorrow.
May the Trend be with you,
André
Somer Traders humour for a moved Wednesday:
The Important One:
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Investing real money can be costly; don’t do stupid shit
Leave politics at the door—markets don’t care.
Past performance is hopefully no indication of future performance
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