Post Inauguration – approaching 100 days

Post Inauguration – approaching 100 days

Back in November 2016, the people of America went to cast their vote for their 45^th President. There were two main candidates – Donald Trump and Hilary Clinton, the polls indicated a win for Clinton but the result proved the opposite. Even though Clinton won the Popular vote, Trump won the vote that counted – the Electoral vote which made him become the President of the United States of America. Before the election took place, the large majority of experts predicted an adverse effect on financial markets if Trump wins. We are now close to 100 days into the Trump presidency and the impact on financial markets has been quite different to what most expected.

» Forex – USDJPY
Since Donald Trump’s inauguration on 20^th January 2017, we have seen mixed movements in the US dollar against the other currencies. Since the expected US Federal Reserve 25bp interest rates hike on 15^th March this year, we have mostly seen a declining US dollar against the Japanese Yen.  There is no doubt a lower USD is what Trump has been advocating for and USDJPY fell to its lowest level since October 2016 last week.

USDJPY

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Source: GO Markets MT4

» Indices
US Indices have been on a steady rise since the election of President Trump, as you can see in the charts below (vertical red line for the inauguration date – 20/01/2017). It is now nearly 100 days since President Tump has been in the office and it is hard to foresee which way the financial markets will move but President Trumps decisions and policies may well have an impact on it.

One of Trump’s biggest and highly anticipated plan is his $1 trillion spending on infrastructure projects. The program would include a strategic, targeted program of investment valued at $1 trillion over 10 years. The proposal will cover more than transportation infrastructure, it will include energy, water and potentially broadband and as well as veteran hospitals which will create millions of jobs and boost improve the American infrastructure. Trump has said he will ask lawmakers to approve this legislation which will cost the huge amount of money and it will be funded by a mix of direct federal investment and private financing. Is Trump going to get this legislation approved? Only time will tell but it is certainly the one to watch out for in the coming months.

WS30

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Source: GO Markets MT4

On 25^th January 2016, Dow Jones reached the landmark 20,000 barrier for the first time ever as Trumps pro-growth policies boosted the financial markets. The so called ‘Trump Rally’ was re-ignited by Trump signing a series of executive orders since his inauguration when he took office at the end of January.
It only took two months (42 sessions) for the Index to climb from the first close above 19,000 to 20,000.  It is worth pointing out that the rise between 18,000 and 19,000 took over 480 trading sessions.