Stock Market Reactions Post-Election: A Glance at Changes and Indicators
Stock Market Reactions Post-Election: A Glance at Changes and Indicators Following a major win for a U.S. election, the stock market seems to look up to a big rise in relevant indexes. The resultant rise seems to be based on some confidence on the part of investors who believe there would be a change in the economy led by the newly elected government. But there is another side to the story: increasing bond yields hint towards the possibility that markets are looking at some turbulence very soon. What's Driving Market Optimism? Much of the gains across indexes are tied to investor expectations that business-friendly policies could emphasize deregulation, tax incentives, and other stimulative measures. Businesses alike view such policies as often involving fewer constraints on spurring expansion, innovation, and also potentially profitability. Many investors are buying up stocks in anticipation of a favorable environment that could spur overall growth. Bond Yields and Market Caution...