In this podcast, Edmund Shing discusses the impact of President Trump's re-election and the Republican Party's control of major seats of power in the US.
The "Trump trade 2.0" has led to a stronger US dollar, higher bond yields, a sell-off in gold, and higher US stocks, particularly benefiting US small cap stocks.
The main drivers are expectations of lower corporate taxes, deregulation, and higher tariffs on imports, especially from China and Europe.
There is uncertainty about the actual impact of these policies, as Trump will not take office until 20 January 2025, and the current Biden administration remains in power until then.
Investment opportunities may lie in US agency bonds, short-term investment-grade corporate bonds, and gold, with a 12-month target of $3,000 an ounce.
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