US Elections 2024: How Trump's Victory As President Will Impact Global Market? Find Out Here

US Elections 2024: The United States Of America has elected its President, bringing back its former leader Donald Trump. Leading the republican party, Trump made a historic win against Kamala Harris who had succeeded former President Joe Biden of Democrat. With Trump's return to power, the focus will shift towards his policies and reforms that will shape not just the United States but also impact global economies. Trump takes the reign of the world's largest economy at a time of chaos in geopolitical scenarios. How will Trump's victory impact the global market?

As per the latest counting, Donald Trump becomes the 47th President of United States, while JD Vance is titled as Vice President.

Trump creates history with his second win. He becomes the first Republican presidential candidate to win the popular vote since 2004, while he is also the first former president since with a non-consecutive second term since Grover Cleveland in 1892.

Attention will shift to the impact of his protectionist policies on both the US and global economies. Markets have responded positively, with indices rising and the USD strengthening, largely due to Trump's previous term, which saw tax cuts and deregulation benefiting sectors like manufacturing, energy, and defense," Ross Maxwell, Global Strategy Operations Lead, VT Markets said.

However, Maxwell also pointed out that Trump's protectionist stance-potentially imposing heavy tariffs on imports-could have wide-reaching effects, particularly on emerging markets that rely heavily on trade with the US. India, in particular, may face challenges from a stronger USD, leading to capital outflows and inflationary pressures.

Additionally, he said, Trump's strict immigration policies could negatively affect India's tech industry, which depends on the free movement of skilled labour.

That said, Trump's first term fostered good relations with India, and his view of China as a security threat may lead to efforts to counterbalance China's influence in Asia, which could benefit India. Opportunities in defence, tech, and the expansion of Indian exports in sectors like pharmaceuticals and IT services may arise.

In summary, Maxwell said, "while Trump's policies present both risks and opportunities, they are likely to create a cautious outlook for the global economy."

Meanwhile, Narendra Singh, smallcase Manager and Founder at Growth Investing said, President Donald Trump's US election win is positive for India, whereas Trump's America First approach means a more bilateral rather than a multilateral approach to foreign policy. In Asia, he is likely to maintain a hawkish stance towards China. Countries will be pressed to take sides, increasing polarization risks. If overall sentiments are to be accounted for, majority believe Trump 2.0 will be impacting negatively across Asia. however for India; despite short term disruptions, offset by the medium- term benefit to India from supply chain relocation, as de-risking from China strategy gains further momentum under Trump 2.0.

Here are key impacts of Trump's victory on interest rates, foreign funds flow, US market, rupee, Indian market and more by Singh:

1. Impact on interest rates: FED would continue to follow its Policy which is in census with US Govt, although many believe with Trump 2.0 Interest rates would be lower. I expects a rise in US bond yields, which may affect the US Federal Reserve's plan to cut interest rates.

2. US and Indian markets gained: Wider belief that Trump, given his anti-China and pro-Russia stance, may be more favourable toward India than Kamala Harris might have been. However, potential issues remain, particularly concerning trade and tariffs. In a broader term India stands to gain particularly in Initiative on Critical and Emerging Technology (iCET), GE-HAL Engine deal, De-risking of Supply chain from China.

3. INR has hit an all-time low: US election results is likely to cause a short-term volatility in the markets both secondary markets as we have seen and similarly in Forex. Gradually as the volatility subsides, market will come to its senses and then further USD-INR impact can be assessed. Broader term INR seems to be heading to further lows in short to midterm, further weakness can continue if Tariffs are reciprocated under Trump 2.0

4. Fund flows: Trump win may likely to re-energise the dollar and renew investor interest in US assets which may, in turn, accelerate foreign portfolio outflows from India to an extent. But this view may not be true as India becomes more strategic partner to counter china via Quad, I believe India will receive more FDI in areas if manufacturing, Technology in defence and more of Global capability centres. It would look like more of FDI vs FII in Medium term."

"America First" of Trump is likely to make a paradigm shift in trade policies, Vinit Bolinjkar- Head of Research at Ventura Securities said, Brace for immediate market fluctuations and a possible shift toward isolationist trade policies. Trump's presidency would likely mean an increase in tariffs, which could disrupt global trade and hit emerging markets especially hard. Key sectors like tech and manufacturing might experience sharp changes as policies cater more heavily to 'America First' interests, potentially straining relationships with major trading partners like China and the EU."

Hence, Ventura's expert believes global markets could initially react with volatility, especially as investors weigh the impact on global supply chains and economic growth. Trump's administration has previously shown a willingness to shake up existing norms, so we might see economic indicators like inflation and interest rates in the U.S. diverge more sharply from global trends.

For investors, Bolinjkar suggested, this would be a time to monitor assets in regions sensitive to U.S. policy changes, with an eye on any protective measures taken by other economies in response.

After his win, Donald Trump said, America has given us an unprecedented and powerful mandate. He promised during his Florida rally that America is going to enter into an 'Golden Age'. He vowed to restore America to greatness, and fulfill the country's mission altogether.

Currently, Wall Street is cheering Trump's win with sky-high performance. At the time of writing, Dow Jones surged by 1,442.12 points or 3.4% to 43,664. While Nasdaq index skyrocketed by 485.35 points or 2.62% to trade at 18,922.71. Lastly, S&P 500 index surged by 2.29% or 132.39 points to perform at 5,915.71. These indices have touched fresh record highs after Trump's win.