With Joe Biden set to become the 46th US president, investors are wondering what next, especially since it remains unclear whether the Democrats will have (a form of) control of the Senate and hence whether they will be able to enact much of their policy agenda.
For now, US equity markets have welcomed the election result, but renewed volatility looks likely as runoff elections approach in early January for two Senate seats. These two runoffs appear likely to decide the balance of power in Congress and the size of any stimulus package for an economy under renewed pressure as the COVID-19 caseload rises.
In our latest research paper, ‘US elections 2020: Biden and the uncertain state‘, our team review these topics as well as the market implications of a potentially divided Congress for policy implementation and a major fiscal stimulus.
Any views expressed here are those of the author as of the date of publication, are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may take different investment decisions for different clients.
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