Weekly "Focus" and the Trump Market Moves

Two big market moves this week showing the initial reaction to the election of President Trump to a second term. The equity markets staged a significant rally to new all-time highs. The bond market went in the other direction, selling off on the expectation of higher long-term inflation due to President Trump’s expected economic policies. The yield on the benchmark US 10-year Treasury bond backed up to 4.44%, the highest level since June and more than 0.75% higher since the low point in 2024 set just two months ago. On Thursday, the US central bank, as expected, lowered short-term interest rates by a further 0.25% with a focus on ensuring a robust labour market. For more colour, check out the attached report entitled: Red Sweep: Trump the Sequel from Stéphane Rochon, Equity Strategist with BMO Private Wealth.

 

This week’s "Focus" from our economics team is also attached.

 

Have a great weekend,

 

Brad

Senior Portfolio Manager and Senior Investment Advisor