President Joe Biden: The Markets and the First 100 Days

President Joe Biden: The Markets and the First 100 Days

With a new president in office, we now transition from Donald Trump’s nationalism to Joe Biden’s progressive politics. The question on many minds is: how will Biden’s 100-day agenda affect the markets?

Joe Biden and Eliminating the Coronavirus

President Biden firmly believes that for the U.S. economy to thrive, the country must first address the pandemic. He has called the vaccine rollout thus far a “dismal failure” and promised to “move heaven and earth” to get citizens vaccinated. Many analysts share Biden’s frustration, as the infrastructure for vaccine distribution wasn’t in place despite a year of preparation.

Coronavirus Efforts and Market Impact

Biden has set a goal of vaccinating 100 million Americans within the first 100 days. Achieving this would bring the U.S. closer to herd immunity—though the effects would be slow to materialize. Over time, herd immunity would likely be a positive factor for equities and could provide short-term support for “risk-off” assets like gold.

Joe Biden’s $1.9 Trillion Stimulus

Biden’s $1.9 trillion stimulus package includes $1,400 direct payments to American citizens, as well as funding for state governments to help citizens through the ongoing crisis. This stimulus is expected to boost the economy, but it may also raise inflation concerns, especially as the U.S. government will have spent a total of $5.4 trillion on pandemic-related measures. The influx of money may push the dollar lower, while equities could see an initial rise due to the confidence boost provided by the stimulus. However, some of this may already be priced in, given the Democratic control of the Senate.

Progressive, Globalized Foreign Policy and Climate Change

Biden aims to rejoin the World Health Organization and the Paris Climate Accord, both of which Trump had withdrawn from. He also plans to sign an executive order to develop a roadmap to achieve a 100% clean energy economy and net-zero emissions by 2050. Biden’s progressive politics and commitment to climate change action could result in global competition affecting American exports. U.S. manufacturing companies may face challenges, while investments could shift away from non-renewable energy companies due to potential legislation targeting them.

Looking Ahead

Biden’s first 100 days will set the tone for his presidency. It’s a time of significant policy change, and markets will be closely watching for the effects of his coronavirus response, economic stimulus, and progressive politics. What do you expect to see in these crucial first 100 days?