Sudden, large shifts in election odds are unusual in American politics, although it seems like we just had one. Here are some results, as reported in the FT:
The U.S. closed higher in the first session of the second half of the year, even as Treasury yields hit multi-week highs.
Strong gains in the technology sector helped the benchmark S&P 500 index gain 0.3%, despite nearly three-quarters of the index’s constituents falling on the day. The Nasdaq Composite added 0.8%, with all of the Magnificent Seven technology groups ending higher.
U.S. Treasury bonds fell as traders assessed the chances of Donald Trump being elected president later this year. The yield on 10-year bonds jumped 0.14 percentage points to 4.48%, its highest level in a month.
“Trump’s return to the White House will have several implications for investment,” said Jack Ablin, chief investment officer at Cresset Capital. “(The most notable would be) a continuation of elevated Fed interest rates for an extended period of time as policymakers increase the likelihood that corporate tax cuts will be extended next year.”
The immediate reaction of the S&P 500 was also modestly positive, rising about half a percentage point.
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