Media Room
The week in the markets –
November 8, 2024
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With the U.S. election behind us, what’s next?
- Donald Trump won the election, and markets seemed happy.
- The yield on 10-year U.S. Treasuries went up as higher inflation expectations rose.
- The U.S. Federal Reserve cut its rate by 25 basis points.
The U.S. election is behind us and Donald J. Trump won the presidency in spectacular fashion, even gaining the popular vote. The markets reacted strongly, with all major U.S. indices rising on Wednesday, led by small-cap companies. What’s next? First, the situation in the U.S. House of Representatives remains uncertain, though it is currently leaning Republican. This is significant, as it will be critical for the implementation of major policies. If Republicans do gain full control, the 2017 tax cuts, set to expire next year, could be back on the table. However, this doesn’t necessarily mean spending cuts will follow. Market expectations suggest spending may actually rise, especially on defence. Consequently, budget deficits are also likely to increase, which partly explains the rise in the 10-year Treasury yield earlier this week. Another reason for the strong performance in markets, post-election, was the anticipated reduction in regulations, particularly in energy, finance and labour.
News of a U.S. Federal Reserve (the Fed) decision on interest rates went somewhat unnoticed, amid the chaos of the election. We saw a 25-basis-point (quarter of a percentage point) cut. During his press conference and in the document accompanying the decision, Fed chair Jerome Powell appeared slightly less upbeat in his fight against inflation than previously. The more confident language that he had used previously was missing from this statement.
This sentiment was shared by the markets following the election, as we saw the 10-year Treasury yield go from 4.28% before election night to a high of 4.47% on Wednesday. It eventually settled at around 4.33% after the rate cut announcement. Interestingly, Powell said that the election would have no effect on policy decisions for now. He said the risk of inflation and the risk to the economy are currently well balanced and both are in a very good place.
To learn more about the election and its impact on the markets, listen to our regular podcast for further insights.
This week's market closing value - week ending November 8, 2024
(As of 4:00 PM ET.*)
| EQUITY INDICES | Level | Change | WTD | YTD | 1-year | 5-year |
| CAD | CAD | CAD | CAD | |||
| S&P/TSX | 24,722.09 | 474.95 | 1.96% | 17.95% | 26.58% | 7.93% |
| S&P 500 | 5,995.18 | 266.14 | 4.34% | 31.89% | 38.00% | 15.31% |
| DJIA | 43,988.99 | 1,936.80 | 4.30% | 22.53% | 30.09% | 10.82% |
| FTSE 100 | 8,072.39 | -104.76 | -1.55% | 11.09% | 15.72% | 3.14% |
| CAC 40 | 7,338.67 | -70.44 | -2.28% | -0.82% | 5.34% | 4.98% |
| DAX | 19,215.48 | -39.49 | -1.54% | 16.93% | 27.39% | 8.25% |
| Nikkei | 39,500.37 | 1,446.70 | 3.86% | 14.62% | 22.64% | 4.94% |
| Hang Seng | 20,728.19 | 221.76 | 0.82% | 28.20% | 19.62% | -4.51% |
| CURRENCY RETURNS |
CAD | Change | WTD | YTD | 1-year | 5-year |
| US$ | 1.3914 | -0.0041 | -0.29% | 4.98% | 0.88% | 1.02% |
| Euro | 1.4914 | -0.0202 | -1.34% | 1.94% | 0.97% | 0.46% |
| Yen | 0.0091 | 0.0000 | 0.05% | -2.90% | -0.13% | -5.50% |
| CANADIAN TREASURIES | Yield | Change | COMMODITIES | USD | Change |
|---|---|---|---|---|---|
| 3-month | 3.50 | -0.01 | Oil | $70.44 | $0.99 |
| 5-year | 3.02 | -0.05 | Gold | $2,685.33 | -$48.55 |
| 10-year | 3.18 | -0.10 | Natural Gas | $2.67 | $0.01 |
| CANADIAN PRIME RATE |
|---|
| 5.95% |
*The data contained in the charts above is provided by Bloomberg as of 4:00 PM ET. Please note that the final closing market values may vary due to data delays and market settlement.
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