Major shift in US presidential campaign. Financial markets don’t like uncertainty

President Joe Biden has done what has been in the air since the memorable presidential debate: he has resigned from running for a second term. He will serve as president until January 2025. I would like to remind you that he announced before the first elections that he would not run for a second term.

It was a very reasonable decision. Unfortunately (if I were an American, I wouldn’t vote for Donald Trump) he changed his mind, and the Democrats couldn’t say “no.” Now they have a big problem because they have to change the candidate at the end of the race. As we know from the Polish experience, this should not end in failure, because the media in the United States is more balanced than in Poland.

The rest of the article is below the video.

Biden is likely to be replaced by Vice President Kamala Harris. Most experts agree that Michelle Obama, the wife of former US President Barack Obama, could defeat Trump. However, she does not want to agree to run for president despite the appeals of many politicians, so we must accept the fact that this is unacceptable. Harris will be the Democratic nominee. There are other candidates (Newsom, Whitmer), but for legal and financial reasons they may not take her place.

According to RealClearPolitics, the six largest bookmakers in the United States gave Kamala Harris a 20% chance of winning the upcoming elections before Biden’s decision. Now, of course, that will change. More players will bet on Harris to win. It’s hard to gauge how voters will view a Kamala Harris nomination. I’ve seen polls that show Trump tied against Harris.

Before the June presidential debate, the politician had less support than Joe Biden and did not do enough to win new supporters, US experts say. Others point out that her post-debate speech was so powerful that it cast her in a new light and led some to believe she could crush Donald Trump in the election.

To investors, Kamala Harris is a completely unknown figure. Biden’s resignation and the nomination of the current vice president may not have caused major moves in financial markets. Stock market players (and I will) should wait at least a week, maybe even two, to see what Kamala Harris or any other Democratic representative says now. Harris’s views are very similar to Biden’s, but the race for the presidency could change them. The new candidate and his entourage must enter this completely new situation for the United States and seek broad support.

Financial markets like what Donald Trump has announced – tax cuts, lower tariffs, deregulation. In my opinion, this is not a good set of views for the world and the American economy in the long term, but the markets still remember the boom after Donald Trump was elected to his first term. After recent events, investors assumed that this candidate would win the election. Now that certainty has been replaced by uncertainty. Financial markets don’t like uncertainty. I don’t know what will happen on Monday, but I think the correction we (Xelion) announced in Q3 has built a solid foundation.