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The stories that matter about money and politics in the race for the White House
Bitcoin rose on Monday after an assassination attempt on Donald Trump, as traders increased their bets on the former president’s victory in November’s US presidential election.
The price of bitcoin rose more than 10 percent to $63,595, its highest level in two weeks, after Trump was wounded in the ear during an assassination attempt by a gunman at a campaign rally over the weekend. The Republican is seen as the most pro-crypto candidate, having hosted industry leaders at Mar-a-Lago and expressed enthusiasm for the US-based bitcoin miner.
The Trump campaign has also accepted payments in cryptocurrency, a first for a major US political party, raising hopes for a move away from US regulatory measures on the industry for the first time in years.
“The probability of a Donald Trump victory has increased significantly,” said Grzegorz Dróżdż, market analyst at currency company Conotoxia, adding that a Trump presidency will “positively affect” the crypto.
The implied odds of Trump winning in November rose immediately after the shooting, according to live trading at political betting site PredictIt.
Shares in Trump’s social media company Truth closed 31 percent higher. Trump Media & Technology Group, which reported an operating loss of $98 million for the three months to March 31, went public that month in a merger with a blank check company and recently rallied ahead of the debate between Trump and President Joe Biden last month. .
Prison operators gained, with Geo Group shares closing up almost 10 percent and CoreCivic adding 8 percent. Shares of US arms makers also rose. Sturm Ruger & Co gained as much as 12 percent while Smith & Wesson Brands rose 14.3 percent.
“For prison stocks, the expectation is that if Trump wins, he’ll get tougher on the border and those companies will benefit,” said Michael O’Rourke, chief market strategist at JonesTrading, who was less convinced. that the guns were clearly linked to Trump. trade. “Arms stocks always have volatility during the election cycle, and it usually ends up being just a lot of noise in the market.”
The S&P 500 closed 0.3 percent higher on the day, albeit just short of a new record.
“A presidential candidate surviving an assassination attempt is good news in itself [Monday] it’s been a fair reaction,” continued O’Rourke. “But I don’t think stocks are going to go up a lot of percentage points here just because Trump is now the favorite to win the election by a bigger margin than before.”
Cuts to the likelihood of a second Trump presidency, however, sent ripples through broader financial markets. US Treasury yields rose in a more muted version of the reaction that followed Biden’s disastrous debate performance.
Many investors believe Trump’s tax cut policies will fuel deficits and inflation, hitting US Treasuries and sending yields higher in a pattern similar to the aftermath of his 2016 election victory.
The U.S. dollar index, which tracks the greenback against a basket of six other major currencies, was steady, weakening in July as traders increased their bets on a September interest rate cut by the Federal Reserve.
Yields on the 10-year Treasury rose 0.04 percentage point to 4.22 percent, reflecting a small price drop.
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Monday’s movements “chime[s] with the Trumpian theme given the popular narrative of being good for business and . . . its pro-crypto stance,” Rabobank analysts said in a note to clients.
“For markets, the complexities of the US political backdrop have boiled down to the assumption that the weekend’s events will lead to a greater chance of Trump winning the November presidential election,” they added.