Market Reaction:
• Dow futures: +65 points (+0.2%)
• S&P 500 futures: +0.1%
• Nasdaq Composite futures: Unchanged
Incident Details:
On Saturday, during a rally in Butler, Pennsylvania, former President Donald Trump was shot in the ear in what the FBI described as an assassination attempt. The Trump campaign reported that he was “fine” following the shooting. The shooter and one attendee were killed, while two spectators were critically injured.
Official Responses:
President Joe Biden spoke with Trump after the incident, condemning the violence in remarks shortly thereafter.
Upcoming Events:
The Republican National Convention begins Monday in Milwaukee, where Trump is expected to be officially nominated as the Republican candidate for the 2024 presidential election. He is also expected to announce his running mate during the convention.
Market Implications:
Despite the dramatic event, the market’s outlook remains unchanged. Trump continues to be seen as the frontrunner for the upcoming election. A Trump victory in November could result in the preservation or expansion of tax cuts and increased tariffs. During a recent presidential debate, Trump reiterated his intention to impose a 10% tariff on all imports, which could increase inflation and complicate interest rate cuts.
Economic Analysis:
Morgan Stanley research suggests that expanding the 2017 tax cuts would significantly boost deficits, potentially sending the US dollar even higher. However, this could also worsen the ongoing inflation crisis, which has shown signs of easing.
Earnings Reports:
The week ahead is notable for earnings reports from major companies, including Goldman Sachs (GS) and BlackRock (BLK).
Conclusion:
The steady market response indicates investor confidence in the stability of the political and economic landscape, despite the alarming event.