Market research firms generally fly under the radar until they produce a piece of work that challenges deeply held beliefs. Fundstrat did just that re
Market research firms generally fly under the radar until
they produce a piece of work that challenges deeply held beliefs. Fundstrat did
just that recently when macro data scientist Alex Wang analysed the causes of
the five best and worst market days during the last 12 US administrations
dating from Ronald Reagan in 1981.
Singapore
Summit: Meet the largest APAC brokers you know (and those you still don’t!).
The chart considers the impact of a range of factors from
corporate earnings and foreign events to economic data and interest rate
expectations. Unsurprisingly, government policy was the most common theme – but
the really interesting finding was how it dominated the peaks and troughs of
one president in particular.
The research indicates that the current presidency was
responsible for the five best and five worst market days since Trump took
office for the second time. According to the analysis, this was not the case for
any other president over the last 45 years.
White House spokesman Kush Desai told MarketWatch that since
president Trump took office, publicly listed companies have reported
blockbuster earnings reports and clocked multiple all-time high stock
valuations because of his pro-growth agenda of tax cuts, deregulation, energy
abundance and fair trade deals.
Hardika Singh, Economic Strategist at Fundstrat, Source: LinkedIn
The best market day was 9 April 2025, when the S&P
500 rose almost 10% after the suspension of the so-called ‘liberation day’
tariffs. However, the unpredictability of Trump’s pronouncements is highlighted
by the fact that one of the worst days came just 24 hours after these tariffs
were announced.
Indeed, all the sharpest stock market falls since January
2025 can be linked to tariff announcements, while the gains have been highly
concentrated.
Hardika Singh, an economic strategist at Fundstrat
suggests that if the five best market days of the current administration were
excluded, the S&P 500 would be down 2.7% since he took office instead of
showing an 18.5% increase.
Perhaps disappointingly for those who believe that
government policy should move markets, the research concluded that the losses
pretty much cancelled out the gains, suggesting that much of the noise that has
emanated from the White House over the last year-and-a-bit has been just that –
noise.
Contents
Turmoil at the Top as Starmer Teeters
There’s a saying in football that you become a better
player when you are out of the team – in other words, when those on the pitch are
messing up the alternative can only be better.
To carry on the footballing analogy, the UK Labour party
spent 14 years on the substitutes bench toning down some the messaging that has
traditionally alarmed financial markets in a bid to make it more appealing to
the business community, particularly in financial services.
Sadly for its supporters, since winning promotion to
Downing Street, Keir Starmer has turned into the Ali
Dia
of British politics.
A series of U-turns and poorly considered policies have
shaken confidence in his leadership and he now stands on the brink after poor
local election results prompted dozens of his members of parliament to call for
his departure.
David Morrison, Senior Market Analyst at Trade Nation, Source: LinkedIn
David Morrison, senior market analyst at Trade Nation
notes that yields on UK government bonds have soared, with the key 10-year gilt
yield pushing up by around 12 basis points before steadying. Investors are
selling UK bank stocks with significant drops in the share prices of Barclays
and Lloyds.
“Domestic political issues undermine sterling as Starmer
desperately attempts to cling on to his position, for some reason,” says
Morrison in a research note dated 12 May.
“Yet despite weakness across the
British pound and euro against the US dollar, both currencies found some
support due to the prospect of higher interest rates.”
Analysts currently expect the Bank of England to hike
rates by around 75 basis points each before the end of the year.
MarketWatch data indicates that 10-year gilt yields are
currently around 5.1%, while 30-year gilt yields have risen to almost 5.8%. The
Financial Times Stock Exchange 100 Index opened today in the red.
One market analyst suggested that the turmoil at the top
of the UK government would create more uncertainty in financial markets as
analysts consider the potential impact on fiscal policy of a change of prime
minister and perhaps more significantly, chancellor of exchequer.
Politics, Populism and Portfolios
Earlier this year, Capital Group published a paper exploring
the global rise of populism (defined as a political style that frames politics
as a struggle between the ‘people’ and the ‘elites’) and its impact on
financial markets.
The authors note that populism reshapes politics and that
its economic consequences are equally profound. They refer to research across
60 countries showing that after an initial wave of optimism, economic
performance deteriorates with real GDP per capita growth slowing by roughly one
percentage point per year in the first five years of populists taking power and
remaining below trend even after 15 years.
🚨 BREAKING:
🇺🇸🇨🇳 PRESIDENT TRUMP WILL FLY TO CHINA ON WEDNESDAY, MAY 13
SOURCES REPORT THAT TRUMP WILL PUT PRESSURE ON XI JINPING REGARDING THE WAR WITH IRAN
EXPECT HIGH MARKET VOLATILITY!! pic.twitter.com/iLAw53pFzw
— ᴛʀᴀᴄᴇʀ (@DeFiTracer) May 10, 2026
That said, the paper also acknowledges that the
alternative to populist governance is not necessarily inclusive growth. In many
countries, the pre-populist trajectory was already characterised by income
inequality, low productivity, demographic headwinds, political fragmentation
and difficulty delivering meaningful structural reform. Populism often emerges
as a break in this stagnation.
While evidence shows populist policies generally worsen
long-term outcomes, they can disrupt entrenched inertia and create space for
reform coalitions. This helps explain why some electorates view populism as a
corrective to an underperforming status quo despite its economic risks.
For investors, these political and economic dynamics
translate into tangible market risks and opportunities.
Historical trends and
recent market behaviour indicate that populist regimes often disrupt
traditional market dynamics, amplifying volatility and pressuring asset
performance.
While populism typically heightens uncertainty and risk
premia, periods of volatility can also create compelling entry points for long‑term investors, particularly
in markets with strong institutions or credible reform agendas.
Moreover, episodes of financial repression (a common
feature of populist policy frameworks, where interest rates are held below
inflation or directed toward government financing) can temporarily support
equity and realasset valuations by suppressing discount rates and
limiting safer yield alternatives.
Market research firms generally fly under the radar until
they produce a piece of work that challenges deeply held beliefs. Fundstrat did
just that recently when macro data scientist Alex Wang analysed the causes of
the five best and worst market days during the last 12 US administrations
dating from Ronald Reagan in 1981.
Singapore
Summit: Meet the largest APAC brokers you know (and those you still don’t!).
The chart considers the impact of a range of factors from
corporate earnings and foreign events to economic data and interest rate
expectations. Unsurprisingly, government policy was the most common theme – but
the really interesting finding was how it dominated the peaks and troughs of
one president in particular.
The research indicates that the current presidency was
responsible for the five best and five worst market days since Trump took
office for the second time. According to the analysis, this was not the case for
any other president over the last 45 years.
White House spokesman Kush Desai told MarketWatch that since
president Trump took office, publicly listed companies have reported
blockbuster earnings reports and clocked multiple all-time high stock
valuations because of his pro-growth agenda of tax cuts, deregulation, energy
abundance and fair trade deals.
Hardika Singh, Economic Strategist at Fundstrat, Source: LinkedIn
The best market day was 9 April 2025, when the S&P
500 rose almost 10% after the suspension of the so-called ‘liberation day’
tariffs. However, the unpredictability of Trump’s pronouncements is highlighted
by the fact that one of the worst days came just 24 hours after these tariffs
were announced.
Indeed, all the sharpest stock market falls since January
2025 can be linked to tariff announcements, while the gains have been highly
concentrated.
Hardika Singh, an economic strategist at Fundstrat
suggests that if the five best market days of the current administration were
excluded, the S&P 500 would be down 2.7% since he took office instead of
showing an 18.5% increase.
Perhaps disappointingly for those who believe that
government policy should move markets, the research concluded that the losses
pretty much cancelled out the gains, suggesting that much of the noise that has
emanated from the White House over the last year-and-a-bit has been just that –
noise.
Turmoil at the Top as Starmer Teeters
There’s a saying in football that you become a better
player when you are out of the team – in other words, when those on the pitch are
messing up the alternative can only be better.
To carry on the footballing analogy, the UK Labour party
spent 14 years on the substitutes bench toning down some the messaging that has
traditionally alarmed financial markets in a bid to make it more appealing to
the business community, particularly in financial services.
Sadly for its supporters, since winning promotion to
Downing Street, Keir Starmer has turned into the Ali
Dia
of British politics.
A series of U-turns and poorly considered policies have
shaken confidence in his leadership and he now stands on the brink after poor
local election results prompted dozens of his members of parliament to call for
his departure.
David Morrison, Senior Market Analyst at Trade Nation, Source: LinkedIn
David Morrison, senior market analyst at Trade Nation
notes that yields on UK government bonds have soared, with the key 10-year gilt
yield pushing up by around 12 basis points before steadying. Investors are
selling UK bank stocks with significant drops in the share prices of Barclays
and Lloyds.
“Domestic political issues undermine sterling as Starmer
desperately attempts to cling on to his position, for some reason,” says
Morrison in a research note dated 12 May.
“Yet despite weakness across the
British pound and euro against the US dollar, both currencies found some
support due to the prospect of higher interest rates.”
Analysts currently expect the Bank of England to hike
rates by around 75 basis points each before the end of the year.
MarketWatch data indicates that 10-year gilt yields are
currently around 5.1%, while 30-year gilt yields have risen to almost 5.8%. The
Financial Times Stock Exchange 100 Index opened today in the red.
One market analyst suggested that the turmoil at the top
of the UK government would create more uncertainty in financial markets as
analysts consider the potential impact on fiscal policy of a change of prime
minister and perhaps more significantly, chancellor of exchequer.
Politics, Populism and Portfolios
Earlier this year, Capital Group published a paper exploring
the global rise of populism (defined as a political style that frames politics
as a struggle between the ‘people’ and the ‘elites’) and its impact on
financial markets.
The authors note that populism reshapes politics and that
its economic consequences are equally profound. They refer to research across
60 countries showing that after an initial wave of optimism, economic
performance deteriorates with real GDP per capita growth slowing by roughly one
percentage point per year in the first five years of populists taking power and
remaining below trend even after 15 years.
🚨 BREAKING:
🇺🇸🇨🇳 PRESIDENT TRUMP WILL FLY TO CHINA ON WEDNESDAY, MAY 13
SOURCES REPORT THAT TRUMP WILL PUT PRESSURE ON XI JINPING REGARDING THE WAR WITH IRAN
EXPECT HIGH MARKET VOLATILITY!! pic.twitter.com/iLAw53pFzw
— ᴛʀᴀᴄᴇʀ (@DeFiTracer) May 10, 2026
That said, the paper also acknowledges that the
alternative to populist governance is not necessarily inclusive growth. In many
countries, the pre-populist trajectory was already characterised by income
inequality, low productivity, demographic headwinds, political fragmentation
and difficulty delivering meaningful structural reform. Populism often emerges
as a break in this stagnation.
While evidence shows populist policies generally worsen
long-term outcomes, they can disrupt entrenched inertia and create space for
reform coalitions. This helps explain why some electorates view populism as a
corrective to an underperforming status quo despite its economic risks.
For investors, these political and economic dynamics
translate into tangible market risks and opportunities.
Historical trends and
recent market behaviour indicate that populist regimes often disrupt
traditional market dynamics, amplifying volatility and pressuring asset
performance.
While populism typically heightens uncertainty and risk
premia, periods of volatility can also create compelling entry points for long‑term investors, particularly
in markets with strong institutions or credible reform agendas.
Moreover, episodes of financial repression (a common
feature of populist policy frameworks, where interest rates are held below
inflation or directed toward government financing) can temporarily support
equity and realasset valuations by suppressing discount rates and
limiting safer yield alternatives.
SOURCE LINK : Markets Swing on Politics as Study Flags Trump Era Extremes and Starmer Faces UK Pressure