The stock market is set to react to the news that President Joe Biden will not seek reelection, which is likely to introduce significant volatility.
A recent study reveals that the pill version of Novo Nordisk’s drug Ozempic may reduce the risk of heart attacks and strokes.
This decision places economic uncertainty at the forefront as Democrats hurry to rally behind a new candidate, with Biden endorsing Vice President Kamala Harris as a potential nominee.
Josh Thompson, CEO of Impact Health USA, noted that if Biden announces his withdrawal from the race, the market is expected to respond with volatility and uncertainty. Investors generally favor stability, and such a major political change would disrupt that environment.
This uncertainty might drive investors toward safer assets, such as gold, silver, and the Swiss franc, which tend to be less affected by political and economic fluctuations.
Additionally, there may be a slowdown in the so-called “Trump Trade.” This market behavior has been gaining traction since former President Donald Trump, the Republican nominee, outperformed Biden in a debate and survived an assassination attempt.
The “Trump Trade” describes how investors react to the possibility of a second Trump administration. Trump has previously been favorable to various business sectors during his presidency, with expectations that healthcare, banking, cryptocurrency, oil stocks, Tesla, and Trump Media and Technology Group would benefit from another term.
Raymond James analyst Ed Mills stated that while Biden’s exit could lead to a reassessment of the race and potentially stall the “Trump Trade,” the broader market reaction may not be significant, maintaining current electoral odds at 60% for Trump versus 40% for Biden or a Democrat candidate.