The markets’ responses to Trump’s win showed that Wall Street has finally learned a fundamental lesson

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The Dow Jones Industrial Average closed at all-time highs on Thursday.

One week ago, many strategists would not have seen this coming if the closely watched polls — which turned out to be incorrect — showed Trump with a clear advantage. Indeed, on Election Night itself, markets went haywire as the results started showing an increasingly likely Trump victory.

And so, there’s a lot of retrospection going on.

“I’m kind of proud of the markets” for turning around so quickly, said Jeff Kleintop, the chief global investment strategist at Charles Schwab, in an interview with Business Insider.

“They learned the Brexit lesson: that the market’s first reaction may not be the one that they should follow,” Kleintop said.

Before the US election, experts cautioned against comparisons to the UK’s referendum to leave the European Union, or Brexit. One reason was that polls in the US and UK work differently, and the latter has tended to have a worse track record than the former.

But on Wednesday, the one parallel we can all agree on is that apparently populist movements won both elections. Also, investors, initially caught by surprise, dumped risky assets immediately after both events.

Markets are getting faster at responding to big political events. Kleintop said it took markets three months to fully recover after the 2011 debt-ceiling crisis, during which Congress gridlocked on appropriate government spending and deficit levels. It took markets three days for a post-Brexit comeback, and only about three hours after Trump’s win, he noted. By Wednesday, the Dow Jones Industrial Average had jumped to a new closing high.

As Fundstrat’s Tom Lee said on Monday, a Trump win was not the doomsday scenario for markets. That would have been a Clinton win with Trump refusing to concede the election, because of the extended period of uncertainty it would have brought.

And if there’s anything that’s certain, Kleintop said, it’s that markets will continue to be volatile and go down, then up, then down.

Even a win by Hillary Clinton with a Republican majority in Congress — what the consensus had expected — would have created a sense of gridlock and uncertainty.

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