By Naomi Rovnick, Dhara Ranasinghe and Nell Mackenzie
LONDON (Reuters) – November was a month of clear winners and losers from Donald Trump’s Nov. 5 U.S. election victory.
Trump trades, basically punishing tariff-sensitive property from European exporters to Mexico’s peso and driving funding in the direction of U.S. shares and the greenback, proved profitable. Wall Avenue has rallied, the greenback gained 2% towards rival main currencies and bitcoin surged.
However December may very well be bumpy, with the Trump commerce susceptible to a possible bond market backlash towards fiscal largesse, whereas tariffs would possibly increase inflation and snarl up provide chains.
“Elevated (U.S.) fairness valuations mirror complacency because the more difficult atmosphere we anticipate will not be priced in,” BCA Analysis mentioned.
Here is a take a look at some property within the highlight.
1/ CURRENCY WOES
The euro has suffered its worst month-to-month drop since early 2022, dropping simply over 3% to round $1.05, on U.S. tariff dangers, political upheaval in Germany and France and a pointy regional financial downturn.
Analysts anticipate extra volatility within the $7.5 trillion-a-day forex markets as debate rages about how low the euro can go and whether or not Trump actually will increase the U.S. financial system whereas most others endure.
Mexico’s peso dropped over 1% towards the greenback in November, sterling misplaced virtually 2%. China’s offshore yuan was set for its largest month-to-month drop since Aug 2023, down virtually 2%.
The important thing query in FX markets, Monex Europe senior market analyst Nick Rees mentioned, is: “does Trump’s election victory presage a basic structural shift within the world financial system, or are markets simply engaged in a knee-jerk panic?”
2/ BITCOIN, BOOM OR BUST?
If there’s one asset that smashed it out of the park in November, it is bitcoin.
The crypto forex has surged 37%, briefly eying the $100,000 milestone, on hopes of a extra crypto-friendly regulatory atmosphere below Trump.
The final time bitcoin surged as a lot was February, when cash flooded into new bitcoin exchange-traded merchandise.
So, what’s subsequent? For some within the trade, an increase to $100,000 would mark the area of interest asset lastly going mainstream.
“If bitcoin smashes via the $100,000 stage… then much more folks may discover crypto on their radar,” mentioned AJ Bell funding analyst Dan Coatsworth.
Others reckon there’s a danger of speculative extra, that means bitcoin’s surge may simply as simply be adopted by a pointy fall that catches some buyers out.
3/ TECH UNDER TARIFFS
Wall Avenue’s tech-heavy Nasdaq 100 has scored its finest month-to-month acquire since June as Trump ally Elon Musk’s Tesla surged 33% and AI fervour boosted Nvidia even because the chipmaker forecast slower gross sales development.
