As the U.S. Republican presidential candidate Trump surpasses the election threshold, the “Trump Trade” is gaining strength, with U.S. stocks rising across the board in pre-market trading. Trump Media & Technology Group surged 47.76% pre-market, and Tesla also benefited from CEO Musk’s support for Trump, rising more than 12% pre-market.
(Previous News: Trump “delivers victory speech” with 277 votes surpassing the threshold, but Bitcoin spikes to $73,000—is a reversal imminent?)
(Background Supplement: ETH/BTC falls below 0.035, hitting a 3-year low; even Trump’s election can’t save Ethereum?)
The official vote count for the U.S. presidential election has begun, with Republican presidential candidate Trump leading the race. According to Fox News’ real-time voting data, Trump has secured 277 electoral votes, surpassing the 270-vote threshold needed for victory, defeating Kamala Harris to claim the White House. Trump also delivered a victory speech earlier.
Trump Trade Surges
With Trump crossing the election threshold, investors reacted very positively. CNBC data shows that Dow Jones Industrial Average futures surged 1,112 points or 2.62% to 43,493 points; S&P futures rose 125.75 points or 2.16% to 5,938 points; and Nasdaq futures jumped 363 points or 1.78% to 20,704.75 points.
“Trump Trade” assets showed strong gains, with Trump Media & Technology Group soaring 47.76% pre-market to $50.15, while Tesla also benefited from CEO Musk’s support for Trump, rising 12.87% pre-market to $283.8.
The U.S. Dollar Index strengthened, once surging to 105.326, with the dollar recording its largest gain against major currencies since 2020. U.S. Treasury prices plummeted, and Treasury yields surged significantly, with the 10-year Treasury yield reaching a high of 4.471% today and currently reporting 4.412%.
Market Optimistic About Trump’s Economic Growth Stimulus
Bloomberg reports that although the vote count is not yet complete, market volatility sends a clear signal that investors expect Trump’s second term to be similar to his first, with a series of policies including tax cuts and deregulation, while stimulating economic growth, corporate profits, and inflation.
Columbia Threadneedle Investments rate strategist Ed Al-Hussainy stated: Although investor reaction is generally positive, market volatility also sends a stern warning, as the surge in Treasury yields highlights concerns that Trump’s policies will only further expand the swelling budget deficit and reignite an inflation spiral. In Wall Street parlance, this is the “bond vigilantes” pressuring Washington leaders to control spending.
Currently, long positions in the S&P 500, Nasdaq 100, and Russell 2000 indices have increased to around $400 billion, nearly double what it was two years ago, while short positions have fallen below $100 billion for the first time since 2015.
Deutsche Bank’s global head of FX research, George Saravelos, stated that the more the recent agenda emphasizes tax cuts and deregulation, the more favorable it is for risk assets. However, Ed Al-Hussainy believes there will be some profit-taking in Trump trades, while on the other side, there will be bottom-fishing trades. How much this will balance the market remains too early to tell.
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