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US elections just got a whole lot more interesting as Trump confirms COVID infection – Market Analysis

US elections just got a whole lot more interesting as Trump confirms COVID infection – Market Analysis

Volatility and risk aversion in the market have spiked from already high levels triggered by the disturbing electoral debate.

The perfect storm has appeared with the news that the president of the United States and his wife are infected by the virus and must remain in quarantine for at least ten days, possibly longer, calling off all acts and appearances planned within the campaign election already underway.

It is impossible to predict what the next events will be, but with Trump being a person in the riskiest profile for his age, alarms have sounded in the financial markets.

US Non-Farm Payrolls & the electoral games

The essential economic data of Non-farm Payroll that is published today and the attention of the market and the Federal Reserve was focused, has gone to the background with the news of the president's infection that is undoubtedly going to be the main market-mover of the next few days.

The specific way in which this unforeseen event is going to affect the markets is unpredictable, given the number of variables that can be taken into account when evaluating it.

Some analysts are beginning to consider the fact that Biden being ahead of the election forecasts to be positive for the markets due to the simple fact that this candidate will bring more stability in the field of international trade relations and that a package of a stimulus of sufficient size to meet the needs arising from the pandemic crisis will be approved. Democrats already approved tax incentives for 2.2T Dollars yesterday, but this has to be approved by the Senate (Republican) and the government against this amount, calling it "eccentric."

In any case, in the shortest term during October, we can take uncertainty and volatility for granted.

The first reaction of investors has been to exit investments in risk assets and take refuge in safe-haven assets such as US Treasuries, Japanese Yen, and GOLD.

TECH100 has reversed lower after momentarily breaking above a resistance level around 11,500, suddenly rejecting these levels, which can be considered a bearish sign. At the time of writing this analysis, the index was losing more than 2%.


Buyer power has strengthened the Japanese currency flows in search of refuge, a movement that has been noticed with greater virulence in the case of its price against the Australian Dollar, a currency closely linked to economic growth and the market's risk appetite.

AUD/JPY drops 2% and is technically supported by the 100-day SMA at 75.00. The primary support is in the 74.00 area; its loss would open the way for further losses to the 72.50 area and start a new downtrend.


GOLD reacted to the upside on the news, acting as a pure, safe-haven asset regardless of its correlation with the price of the US Dollar.

After the downward correction in recent weeks, the precious metal has managed to break above the 1900 level. To confirm a new upward movement, it would need to pause and make a daily/weekly close above 1920.

Esta información/estudio preparada por Miguel Ruíz (“el analista de estudios”) no tiene en cuenta los objetivos específicos de inversión, la situación financiera o las necesidades particulares de una persona. El analista de estudios es, principalmente, responsable del contenido de este informe de estudio, en parte o en su totalidad, certifica que los puntos de vista sobre las compañías y sus valores expresados en este informe reflejan con exactitud sus puntos de vista personales, y como consecuencia, toda persona que actúe basándose en ellos lo hace bajo su propio riesgo.

El estudio proporcionado no constituye los puntos de vista de JME Financial Services (Pty) Ltd., ni es una invitación a invertir con JME Financial Services (Pty) Ltd. El analista de estudios certifica, además, que ninguna parte de su remuneración ha sido, es o será directa o indirectamente relacionada con recomendaciones o puntos de vista específicos expresados en este informe.

A partir de la fecha en la que se publique el informe, el analista de estudios y su esposo/a o familiares que dependen financieramente de dicho analista, no mantendrán intereses en los valores recomendados en este informe (“como “intereses” se incluyen la titularidad directa o indirecta de los valores).

El analista de estudios no está contratado por JME Financial Services (Pty) Ltd. Le animamos a buscar asesoramiento con un consejero financiero independiente con respecto a la idoneidad de la inversión, en virtud de otra participación separada, cuando considere oportuno que es conforme con sus objetivos específicos de inversión, su situación financiera o, sus necesidades financieras particulares antes de comprometerse a invertir..

Las leyes de la República de Sudáfrica regirán cualquier reclamación relacionada o que surja de los contenidos de la información/estudio proporcionado.