At present, various states in the United States will gradually end their election voting and begin counting, and the final results still need to be announced. Goldman Sachs recently stated that investors may be nervous about election related volatility, but the market conditions are good and can avoid falling into bear market territory significantly after the election vote.
Goldman Sachs analysts say they believe there is only an 18% chance of the stock market falling more than 20% - a signal of a bear market beginning. They pointed out that a healthy economy continues to drive the stock market higher this year.
Despite the recent weakening of macroeconomic data (partly due to last month's strikes and hurricanes), the friendly macroeconomic background in the United States should limit bear market risks, "analysts said in a report on Monday.
They said that even if bond yields rise significantly after the election, the stock market should continue to perform well, but a faster increase in bond yields or actual yields may bring greater risks.
As long as economic growth accelerates, the stock market should be able to absorb higher bond yields. However, if the actual yield (relative to the expected GDP growth) starts to rise, or if bond yields rise too quickly, the increase in bond yields may ultimately limit the stock market's rise; quot; Analysts say.
Analysts and economists believe that if Trump wins, bond yields may rise, which is a disadvantageous factor for the stock market. Trump's proposed plan to impose comprehensive tariffs and mass deport immigrants may lead to inflation and make it more difficult for the Federal Reserve to continue easing monetary policy.
Analysts also suggest that if Harris wins the presidency of the United States and both parties control both houses of Congress, it could lead to a decrease in bond yields.
The Federal Reserve aggressively initiated a 50 basis point interest rate cut cycle in September this year, and it is widely expected that the central bank will cut interest rates by another 25 basis points this month.
However, the path of the subsequent loose cycle is uncertain. Some strategists warn that the Federal Reserve may pause interest rate cuts in December or early next year. However, some analysts still believe that as the economy slows down and the labor market weakens, the Federal Reserve may cut interest rates significantly again.
As Goldman Sachs analysts predict that the US stock market will avoid a bear market, the S&P 500 index has surged more than 21% this year, and this bull market has lasted for over two years.
On Tuesday, the US stock market closed sharply higher, experiencing a widespread rebound. Previously, data showed that the economy was stable, but as the presidential election vote was still ongoing, investors were prepared for trading fluctuations this week. The S&P 500 index rose 70.07 points, or 1.23%, to 5782.76 points.
The preliminary voting results for most states in the United States will be released around noon Beijing time today, but the vote counting work for the "swing states" that ultimately determine the election results may take a day or even several days. If the voting results remain unclear within a few days, the market will experience election related fluctuations.