U.S. Election Results Roil Global Markets

Election Decision 2016: Stay the Course

As of U.S. market open.

Donald Trump’s surprising U.S. presidential election win has disrupted global markets.

In an unlikely outcome, Republican Donald Trump is the winner of the 2016 U.S. presidential election. Trump’s victory raises significant questions about the direction of a variety of U.S. government policies. This surprising result has injected uncertainty and volatility into global markets. Major Asian and European equity indices were down sharply after the announcement before recovering somewhat overnight. U.S. markets opened down initially and have seen heightened volatility.

In addition to winning the White House, Republicans maintained control of both the House of Representatives and the Senate. This outcome will likely help create a smoother path for Trump to execute his policies and the Republican platform.

Expectations for a Trump Presidency

In the weeks leading up to today’s events, American Century Investments’ senior investment professionals shared their views on the election in a series of CIO Insights blog posts. Global and Non-U.S. CIO Keith Creveling provided a high-level view of the potential impact of both candidates. Based on a review of policy statements and party platforms, a Trump presidency could deliver immigration reform, lower corporate tax rates, less regulation, and an overhaul, if not complete repeal, of the Affordable Care Act. In addition, Trump’s policies could help financial services firms through less regulation, defense companies via more spending, and drug companies through a more free-market approach to price setting. While his promises to overhaul the corporate tax code would seem to benefit business in general, some investors are concerned about statements on the campaign trail that suggest new tariffs and isolationist policies that could hamper free trade.

Our Commitment

The new administration’s policies are likely to benefit certain sectors and industries in the near term, while adversely affecting others. The bottom line is that the impacts of the election’s outcome are uncertain. Therefore, we urge investors to take a long-term view. As we do in all market environments, American Century Investments’ portfolio managers remain committed to their disciplined investment processes, which become even more important when uncertainty rises. As events unfold, we’ll continue to monitor risks and seek out opportunities, and communicate our observations and strategies to you.

The opinions expressed are those of G. David MacEwen and Victor Zhang and are no guarantee of the future performance of any American Century Investments portfolio.

This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.