How will the Stock market react to the US election results. Will a Biden win cause a drop in the US stock market and how would that affect the Australian share market.
A: The $64 question.
Initially, the Aussie market will follow any significant move in the USA.
I sense that the US market is becoming more comfortable with Biden, but concerned if Biden wins and the Democrats take control of the Senate. My 3 scenarios are:
- Trump wins, and the Republicans control the Senate – initially positive for markets
- Biden wins, but the Republicans still control the Senate – not that bad for markets, maybe an initial sell-off (depends on how much is factored in by markets over the next two weeks)
- Biden wins and the Democrats take control of the Senate – negative for markets
