Market Mayhem: Biden’s Exit Stirs Economic Uncertainty

The stock market is expected to react with volatility as it opens tomorrow after President Joe Biden announces he will not seek reelection. This news could lead to significant economic uncertainty as Democrats work to rally behind a new candidate, with Biden having endorsed Vice President Kamala Harris for the nomination.

Josh Thompson, CEO of Impact Health USA, commented on the potential market impact, stating, “If President Biden were to announce his withdrawal from the reelection race, the immediate market reaction would likely be one of volatility and uncertainty. Investors generally prefer stability and predictability, and such a significant political shift would disrupt both.”

In light of this uncertainty, investors may flock to safer assets such as gold, silver, and the Swiss franc, which tend to perform better amid political and economic instability.

There is also the potential for a slowdown in the ‘Trump Trade,’ a term describing market behaviors in response to the expectation of a second Trump administration. This trade has gained momentum following Trump’s performance in debates against Biden and his survival of an assassination attempt. A second Trump presidency could benefit sectors including healthcare, banking, cryptocurrency, oil stocks, and companies like Tesla and Trump Media and Technology Group.

Ed Mills, a Washington policy analyst at Raymond James, noted that while Biden’s exit from the race could stall the recent momentum of the ‘Trump trade,’ he does not anticipate a broader market reaction. Mills currently assesses the electoral odds at 60% for Trump versus 40% for Biden or another Democratic candidate.

Popular Categories


Search the website