Sam Dickie: Fisher Funds expert on the reaction from global markets after Donald Trump won

The US dollar surged and bitcoin hit a record high after Donald Trump swept through the battleground states and won the presidency.

Despite the race starting off too close to call, markets picked up after Trump was determined the winner of the election.

Sam Dickie from Fisher Funds explains what happens next.

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Episode Transcript

Speaker 1 (00:00):
Ever du for l So the trunk victory has resulted
in some very sharp price moves and the asset prices
around the world. As we've been discussing, equities have rallied sharply,
bonds have sold off. Question is what's the early read
from the markets? What does it all mean for investor?
Sam Dickey from Fisher Funds is with us. Hey, Sam, hey, okay,
what did very well?

Speaker 2 (00:18):
Thank you?

Speaker 1 (00:18):
What did the equity markets think of the victory?

Speaker 2 (00:20):
Then global it could be your big moves across the
board in this Finacia classes, but equities a strong reaction,
so about three percent up globally, but it was very
US centric. So as a general backdrop, the markets bullish
corporate tax cuts, as bullish less regulation, as bush less
red tape, and it's sort of pro growth domestic infrastructure spending.

(00:41):
But moving to bonds and they sold off, which is
the same thing as saying interest rates when happened. This
is one thing to keep an eye on. So if
you look at US bond yields now they're back at
levels we saw way back in July, which was before
we saw that bid repricing and feed rate cuts. So
people are bidding there that Trump will drive inflation and

(01:03):
growth higher, which means higher interest rates.

Speaker 1 (01:07):
Can you read into it how much they're expecting the
interest rates and the inflation to increase.

Speaker 2 (01:15):
You can't. You can't necessarily map a moving interest rates
to a moving inflation. But if you look at what
the market's pricing in terms of rate cuts by the
Feed twelve months ahead. Back in July, the market was
pricing five rate cuts and then it went as far
as pricing sort of seven or eight rate cuts at
one point in time. Now they're only pricing free rate

(01:36):
cuts and the twelve months ahead. So people are expecting
that the Trump's going to be reflationary and drive growth,
which means the Fed needs to cut rates less quickly.

Speaker 1 (01:47):
Interesting, Okay, And obviously we've seen the currencies move. Their
USD has gone up, Crypto's gone up. How far do
you see crypto going off the back.

Speaker 2 (01:56):
Of this, Well, I mean there's a couple of things
coming on there right as one of these obviously very
probate call and I think you said, make America at
the crypto capital of the planet. So that's all go.
And the other thing is which I don't agree with
this one, is that some people see cryptos as good
inflation head often fation goes up, crypto is a good

(02:16):
place to be. Now, that's was not true during the
twenty twenty two inflation spokes a bitcorn actually fell by
seventy five percent as the far far ago. See either
the other people out outside of me, you will be
able to give the answer to that, or will be
able the answer to that.

Speaker 1 (02:32):
It's a fascinating one to look at. What have you
seen in equities across countries and the cross sectors that
you're fascinated by.

Speaker 2 (02:40):
Yeah, definitely the US is the winner, which shouldn't come
as any surprise. But you know, look at New Zealand, Australia,
European and emerging market equipments. They're basically flat. And everyone's
watching China obviously given the rhetoric, and that was weakest
running into the election, but it's held up okay since
So that's that's mildly interesting. But under the hood in
the US is where all the actions being some huge

(03:00):
moves there, so perceived winners are domestic facing this sectors.
So to give you a few names, you are steel
companies up thirteen percent. Is everyone is expecting the first
tariff he will throw in China will be steered back
back in twenty sixteen twenty seventeen, US auto manufacturers are
like forward up five six percent because of this competition

(03:21):
from important orders. And of course Tesla is up fourteen
percent because Trump is mates with Elon. And US trucking
and rail companies up ten percent, partly driven by this
environmental and emission regulation. And this was quite surprising as
giant banks JP Morgan up ten percent overnight because he's
talking less regulation and many roles to perceived losers sold

(03:45):
the companies down twelve. He said that they are part
of the new doing scan and his proposed tariffs that
will impact that sector. Go figure and just ranom on
Cannabis stocks down twenty percent in favor of legalized cannabis.
But coincidentally, there was a couple of proposals today yesterday.
I think legalized marijuana and Florida are other states that failed.

(04:07):
So outside of that, the only other big moves were
interest rates sensitive companies were property and utilities. They went
down because they want to benefit from this big growth
bonanza that's supposedly going to come, but they will get
hurt by highlight interest rates so a lot.

Speaker 1 (04:22):
Of investors to be thinking about with all the stuff.

Speaker 2 (04:24):
Going on in huge move, and I didn't think it
called the market by surprise. I mean, most betting markets
were expecting him to win, so it shouldn't have covered
such a shock. But I suspect the market was remembering
twenty sixteen too well. So remember the market was convinced
he win and win, and in the unlikely event he
did markets with nose dive and they got burnt on

(04:45):
both counts. So maybe once twice shy, Sam.

Speaker 1 (04:48):
Thanks very much, appreciated, interesting times ahead for you, Sam
Dickey for your funds.

Speaker 2 (04:53):
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