National Mandate for a Big GOP Victory in November, Brings Overseas Investors to US
$DIA, $SPY, $QQQ, $RUTX, $VXX
The 2018 midterm elections only 17 days away, + the political and earnings seasons are in full swing with the S&P 500 numbers coming in higher that expected with 20% of the member reported.
The Big Q’s: How does the world view our leadership and will the trillions of dollars in smart money stay sidelined until Y 2020?
The unexpected loss of Clinton, the delayed victory of Bush (43) from Gore lawsuits, and Hussein-Obama’s tax and spend mandate have caused much market uncertainty and caution for the global investor.
But, Donald Trump’s landslide victory in Y 2016 created so much global interest that investments began to pour into the US before he was even sworn in.
This phenom has been dubbed ‘The Trump Effect.”
The Big Q 2s: Will the voters allow the US economy to continue to move ahead and will mid-term election losses by House Republicans cause President Trump to change his policy or course?
Those of us who remember when President Bill Clinton ran in Y 1996 he had moved toward the center, portraying himself as a centrist on fiscal issues, and began working with Speaker Newt Gingrich and all concerned parties to make the country more efficient.
And then what happened?; the global investing community saw several things: leadership, fiscal restraint, and the government working for the people and business.
Now, because President Trump has been so successful at lowering business regulatory Red-tape and taxes, the global investors and sovereign funds are and are staying interested in the US markets.
The tax situation is Key
With 90% of global customers being outside of the US, “Smart Money” goes where the taxes and governments are the most business friendly. As a result, if President Trump stays in power with congressional support, global confidence in the US will continue to gain momentum. And more money will flow into US stocks and business investments.
Notably, Gold is still priced low, but real estate is reaching new heights, and the stock market, in a record Bull run, is at record highs.
We have seen economic cycles ebb and flow every 5-8 years., with participants taking some profits off the table, as others enter into the market’s momentum.
We are seeing lots of cash floating around; people are buying up assets with either stock or cash.
The Big Q3: How does this relate to the midterm election?
The Big A: It is a policy and confidence issue.
Every country has political leadership and policies which are analyzed individually, by us and people like us here at HeffX-LTN to see how they will compete globally.
Savvy investors, aka “Smart Money” will focus on investing in countries which are the most business friendly. Without business-friendly policies and leaders, there are no profits, no investors, no jobs, no innovation, and no taxes paid in..
Notably, a big percentage of US stocks are owned by offshore funds, ETFs, hedge funds and investors. America needs these global investors and needs their unwavering confidence.
Because, global investors look for signs and analyzing the landscape to see which direction the country is going. If the US continues to minimize waste, taxation, corruption, and red-tape, then global investors will see value and continued growth potential in the US and new money will flow in.
We are at a time for bold, innovative, laser focused economic leadership that is honed in on the American businesses and American working families who have built this nation into the world strongest, efficient and most competitive.
What I see as of today
The Democrats statistically have many more seats to lose this year in the Senate, and so, President Trump should keep a Republican Senate for another 2 years of about 53-57 Republicans. As for the House, the Republicans will probably hold a slim majority in the House for another 2 years as well.
President Trump is polling higher than he was on Election Day in Y 2016, the probability of a continued national mandate favoring his policies should be even stronger, therefore Keeping America Great!
Friday, the major US stock market indexes finished at: DJIA +64.89 at 25444.34, NAS Comp -36.11 at 7449.22, S&P 500 -1.00 at 2767.92
Volume: Trade on the NYSE came in at 939-M/shares exchanged
- NAS Comp +7.9% YTD
- S&P 500 +3.5% YTD
- DJIA +2.9% YTD
- Russell 2000 +0.4% YTD
HeffX-LTN’s US Major Stock Market Indexes Technical Analysis for the Week Ending 19 October 2018
Have a terrific weekend,