Pepperstone logo
Pepperstone logo
  • Français
  • English
  • Español
  • Italiano
  • Trading

    Vue d'ensemble

    La tarification

    Caractéristiques de nos Comptes

    Compte CFD Risque Limité

    Comptes de négociation

    Pro

    Heures de négociation

    Calendrier de maintenance

  • Plateformes

    Vue d'ensemble

    Plateformes de négociation

    Intégrations

    Outils de trading

  • Marchés et symboles

    Vue d'ensemble

    Le marché des changes

    Actions

    ETF

    Indices

    Matière Première

    Indices de devises

    Dividendes pour les CFDs sur indices

    Dividendes pour CFDs d'actions

    CFDs à terme

  • Analyse

    Vue d'ensemble

    Naviguer sur les marchés

    Le Daily Fix

    Rencontrez les analystes

  • Apprenez à trader

    Vue d'ensemble

    Guides de trading

    Séminaires en ligne

  • Les partenaires

  • A propos de nous

  • Aide et assistance

  • Professionnel

  • Français
  • English
  • Español
  • Italiano
  • Launch webtrader

  • Trading

  • Plateformes

  • Marchés et symboles

  • Analyse

  • Apprenez à trader

  • Les partenaires

  • A propos de nous

  • Aide et assistance

  • Professionnel

US500
US

The Daily Fix: Trump walks away from Fiscal, but did he really have a choice?

Chris Weston
Chris Weston
Head of Research
6 oct. 2020
Share
Trump is back but he’s moving markets in a direction we’re not used to him taking.

Did the market get stimulus wrong? Perhaps, but they’ve been guided to expectations of bipartisan agreement through recent upbeat dialogue between various leaders. It’s not even just about FOMO these days, but if an agreement was to be struck, you just can’t be left behind – FOMU – Fear of Meaningfully Underperforming.

I've maintained a sceptical view on fiscal given I don’t think the DEMs ever really wanted a deal – why would they? The wind is to their backs, they’re up double digits in the polls and delivering a deal would have given Trump ammunition to take into the election. Well, at least it would've back in August and September, with personal income dramatically boosted and disposable capital ramping up, which would have meant the difference between US Q4 GDP being 10% or 2%, following a likely 30% GDP print in Q3. The DEMs have also recently been helped by news of Trump's taxes, an unfavourable performance in the first debate and the appointment of Amy Coney Barrett. The likes of Nancy Pelosi knew their $2.4t proposal would have unlikely passed through the Senate anyhow.

Trump may have accepted the DEMs proposal, but again knew it would likely have failed in the Senate. He has promised more stimulus post-election, but the DEMs are not going to lose the House, so passing a Trump stimulus in the future (if he was to win) still faces headwinds. Although, these headwinds will be less of an issue after the election. More fiscal is needed, which is a concern given how much has already been rolled out.

Trump’s tweet clearly resonated through markets sending the S&P 500 down 2.2% from the highs of the day, to close -1.4%. The US2000 has certainly outperformed with the small-cap index -0.3%, but it’s enough for me to close my long here for a small loss. The NAS100 closed -1.9% and we’ve seen NASDAQ futures trading 20bp lower on the re-open. Tech remains one to watch given headlines rolling out about the House DEMs plan to break up giant internet platforms from other business lines, limiting the monopolistic qualities of US tech.

Given the DEMs stance on tech, which I am not sure surprises too greatly, it makes me think that if we do see a ‘Blue Wave’ that long US2000 and short NAS100 will be an incredible medium-term trade. If the DEM’s promise huge fiscal spending which will benefit the Russell (the earnings are far more US-centric), while going after big tech, I find it hard to see how this will not be a solid macro thematic trade.

07_10_2020_DFX1.png

The Trump tweet caused a rush to safe havens with US Treasuries bid, with 10s dropping 5bp to 72bp before finding a base, the VIX pushing into 29.5%, and the USD, CHF and JPY all finding buyers, with selling resonating in AUD, MXN and NOK most prominently. AUDUSD was falling anyhow, with one prominent local commentator calling for the RBA to act in November and we see the rates market at 7bp for November and the Aussie 3-yr Treasury now trading at 13.4bp – a cut, it seems is coming, while the RBA will lower the yields cap. More QE for good measures?

Market pricing aside, the RBA made it clear that this is a confidence issue faced in the real economy, not a cost of credit problem. If we explore the last line in the statement – “The Board continues to consider how additional monetary easing could support jobs as the economy opens up further”, it's hard to see how cutting either the cash rate or reducing yield caps aids that. The budget is key here and seems market-friendly enough, and the RBA will welcome the measures, but it's going to be a slow-moving ship and one that may take time to filter into the economy.

We look ahead to see how Asia deals with the above news flow. As we look to Europe the focus falls on German industrial production, September FOMC minutes, and then to the Vice-president debate which promises to be a far more statesman like affair.


Related articles

The Daily Fix: A bullish wave rips through markets

The Daily Fix: A bullish wave rips through markets

USD
The Daily Fix: The worrying message copper is telling us

The Daily Fix: The worrying message copper is telling us

US

Most read

1

The disinflationary message seen in commodities and rates markets

2

Will the BOJ be the last dovish domino to fall?

3

Trader thoughts - the conflicting forces dictating EURUSD flow

Ready to trade?

It's quick and easy to get started. Apply in minutes with our simple application process.

Get startedSubscribe to The Daily Fix
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information provided here, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.

Autres sites

  • The Trade Off
  • Partenaires
  • Groupe
  • Carrières

Façons de commercer

  • La tarification
  • Caractéristiques de nos Comptes
  • Comptes de négociation
  • Pro
  • Heures de négociation

Plateformes

  • Plateformes de négociation
  • Outils de trading

Marchés et symboles

  • Forex
  • CFD sur actions
  • ETF CFDs
  • CFD Indices
  • Matières premières
  • CFD sur les indices de devises
  • CFD à terme

Analyse

  • Naviguer sur les marchés
  • Le Daily Fix
  • Rencontrez les analystes

Apprenez à trader

  • Guides de trading
  • Vidéos
  • Séminaires en ligne
Pepperstone logo
support@pepperstone.com
+44 (800) 0465473
195, Makarios III Avenue, Neocleous House,
3030, Limassol Cyprus
  • Documentation juridique
  • Politique de confidentialité
  • Conditions générales d’utilisation du site Internet
  • Politique en matière de cookies

© 2025 Pepperstone EU Limited
Company Number ΗΕ 398429 | Cyprus Securities and Exchange Commission Licence Number 388/20

Avertissement sur les risques : Les CFD sont des instruments complexes et comportent un risque élevé de perte d'argent rapide en raison de l'effet de levier. 75.3% des comptes des investisseurs particuliers perdent de l'argent lorsqu'ils négocient des CFD. Vous devez vous demander si vous comprenez le fonctionnement des CFD et si vous pouvez vous permettre de prendre le risque élevé de perdre votre argent.

Les transactions sur le Compte CFD Risque Limité sont un type de transaction avec effet de levier et avec un stop loss garanti lié à chaque position. Ces produits présentent un caractère spéculatif et un risque élevé de perte totale du capital investi.


La négociation de produits dérivés est risquée. Il ne convient pas à tout le monde et, dans le cas des clients professionnels, vous pouvez perdre beaucoup plus que votre investissement initial. Vous ne possédez pas ou n'avez pas de droits sur les actifs sous-jacents. Les performances passées ne préjugent pas des performances futures et les lois fiscales sont susceptibles de changer. Les informations contenues dans ce site sont de nature générale et ne tiennent pas compte de vos objectifs personnels, de votre situation financière ou de vos besoins. Veuillez lire nos documents juridiques et vous assurer que vous comprenez parfaitement les risques avant de prendre toute décision de trading. Nous vous encourageons à demander un avis indépendant.

Pepperstone EU Limited est une société à responsabilité limitée enregistrée à Chypre sous le numéro ΗΕ 398429. Elle est autorisée et réglementée par la Cyprus Securities and Exchange Commission (numéro de licence 388/20). Siège social : 195, Makarios III Avenue, Neocleous House, 3030, Limassol, Chypre.

Les informations contenues dans ce site ne sont pas destinées aux résidents de la Belgique ou des États-Unis, ni à une utilisation par une personne dans un pays ou une juridiction où une telle distribution ou utilisation serait contraire à la législation ou à la réglementation locale.