What are the short-term and medium-to-long-term implications of Donald Trump's election and a probable “sweep” Republican victory?

As the U.S. election approaches tomorrow, history shows little long-term S&P 500 impact from election outcomes, while global economic forces like SNB profits and ChatGPT’s energy demands drive market dynamics. Each week, the Syz investment team takes you through the last seven days in seven charts.

In October, fixed income assets faced significant challenges, with the Global Aggregate Bond Index declining over 3%. As the U.S. elections approach, this week is poised to be crucial in determining the future trajectory of the fixed income market.

The Nasdaq Composite reached record intraday highs on Wednesday before falling back sharply on Thursday. Over the week, growth stocks generally lagged value shares. Small-caps also held up much better than large-caps. 42% of the companies in the S&P 500 Index reported their Q3 earnings over the week, including five of the Mag 7. Microsoft and Apple were the biggest losers of the week whereas Amazon and Google gained. On the macro side, the Labor Department reported “essentially unchanged” nonfarm payrolls over the month, with employers adding only 12,000 jobs—the lowest number since December 2020. It included a decline of 44,000 jobs due to the Boeing strike.

Flash note

Kamala Harris boosted by The Magnificent 7, global gold reserves surpass the euro as central banks' second most held asset, and de-euroisation vs. de-dollarisation. Each week, the Syz investment team takes you through the last seven days in seven charts.

With the U.S. term premium turning positive amidst rising bond market volatility, fixed-income markets are facing growing caution as central banks ease, credit markets stabilize, and investor attention pivots towards the U.S. elections, which could shape future fiscal policy.

The S&P 500 Index finished lower after posting gains in each of the six previous weeks as rising Treasury yields weigh on U.S. stocks. Large-cap stocks held up better than small-caps, and growth stocks outperformed value as the Nasdaq Composite Index gained slightly. Tesla was the best performer in the S&P 500 and led the Magnificent Seven, helping to keep the broad index from a steeper decline. The EV car maker posted better than expected quarterly earnings while Elon Musk projected strong sales growth in 2025. The stock recorded its best daily gain (22%) in more than 11 years on Thursday. Meanwhile, Apple dumped as Wall Street analysts downgraded their views on the stock. In Fixed Income, the 10-year U.S. Treasury yield climbed about 10 bps on Monday to 4.20% and stayed around that level for the rest of the week.

Flash note

With synchronized global monetary easing in full effect and U.S. elections just weeks away, bond markets face rising volatility and potential shifts, with inflation risks and fiscal policies likely to play a pivotal role in shaping the near-term outlook.