Trump Leads in U.S. Presidential Election, Dollar Rises but Caution Needed for Adjustment
Today’s market is dominated by the U.S. presidential election. As the vote count progresses, reports indicate that Donald Trump is currently leading, prompting a resurgence of the so-called “Trump Trade” and strengthening demand for the U.S. dollar. USD/JPY surged from the 151 yen level to above 154 yen, while the Nikkei 225 recorded a significant rise of over 1,000 points.
However, it is expected that the market will gradually regain composure. The outcome of the House of Representatives remains uncertain, and even if Trump wins, concerns over the reemergence of trade conflicts could arise, affecting China, Mexico, and even Europe and Japan. Hong Kong stocks have experienced a steep decline, and European stock futures are also showing weakness, signaling the potential for a correction in the dollar’s upward trend.
Key Economic Data and Events to Watch Today In the upcoming overseas markets, the following data releases are scheduled:
- Germany’s Manufacturing New Orders (September), Eurozone Producer Price Index (September), UK Construction PMI (October)
- U.S. MBA Mortgage Applications, Canada Ivey Purchasing Managers Index (October)
- Brazil Central Bank Interest Rate Decision (November) Additionally, U.S. corporate earnings reports from CVS Health, Qualcomm, Arm, Gilead Sciences, and Lyft are expected, drawing significant market attention.
Monitoring the Risk of Dollar Correction As the dollar had already strengthened in anticipation of the election results, there is now a risk of profit-taking in the current dollar-buying trend. Markets often experience reversals after sharp moves, and we are now entering a phase where further corrections may be likely. It will be crucial to closely monitor developments, especially to see if profit-taking intensifies.
