With Election Day in full swing, CNBC’s Jim Cramer has examined recent crypto market action, which suggests that Wall Street traders are betting on a possible Kamala Harris win. An unexpected poll this weekend had Harris leading traditionally red Iowa, marking the first shift of what could be more changes in voters’ mindsets.
Investors React to New Iowa Poll Showing Harris in Lead
A recent poll showing Kamala Harris leading former President Donald Trump in Iowa-47% to 44%-has sparked activity on Wall Street. Iowa, which Trump won in the past two elections, typically favors Republicans. Cramer said this reaction to Harris’s lead in Iowa reveals that traders suspect a broader shift in other red states.
This polling shock has piqued interest, as traders are looking for any market signal to give them some sense of a Harris victory.
Crypto Market Action Indicates Anticipation of Election Outcome
Cramer thinks Monday’s action was all about traders getting ready for the prospects of President Harris. Some of the key sectors higher included:
Homebuilders: DR Horton, Lennar, and Toll Brothers all moved higher, possibly because investors were comforted by Harris’s proposed tax breaks for first-time home buyers.
Companies Reliant on Imports: Constellation Brands and E.l.f. Beauty added to gains, too; both perhaps were buoyed by Harris’s more centrist trade position.
Cramer said Harris’s trade policy may have been seen as diverging from Trump’s more extreme trade tariffs to cause such market movements.
Technology Stocks Fall on Antitrust Action Speculation
Tech giants Amazon and Alphabet declined on Monday, as investors wagered Harris might continue the Biden administration’s tough stance on antitrust policies. Cramer said that Wall Street believes Harris might keep pivotal regulatory leaders, like Federal Trade Commission Chair Lina Khan, who has levied hard antitrust regulations.
Moves such as this reflect speculation in the markets that Harris will continue the policy that fosters competition rather than big business power.
Wall Street’s Predictions According to Cramer
Although Cramer highlighted that traders are not typically the best forecasters of election results, he cannot deny that this market expects election results. According to him, it is most probable that traders are reacting to what they believe to be the early portents while the polls are still closed.
“I like the idea that you can now get a jump on what traders think,” said Cramer. “But I don’t regard traders as the best forecasters of long-term market impacts.”
Crypto Market Reactions to Election Uncertainty
Some traditional “Trump trades” moved unexpectedly on Monday in response to election uncertainty. The U.S. dollar pulled back, along with Treasury yields and even Bitcoin, while Trump Media & Technology Group gained after earlier losses.
“These moves reflect traders hedging against potential volatility that the outcome of the elections could unleash.” As the votes continue to roll in, market analysts will further watch whether Harris’s Iowa lead is a harbinger of more changes in red states.
Conclusion
Wall Street speculates on a possible Harris presidency as Americans vote. It would appear that investors have begun to align their bets with the eventual winners’ speculative policies and regulatory positions. At the same time, traders look at early signs that could determine the direction of the markets after the election.
Cramer says that optimism should be tempered. There is no reason to change your portfolio just because of some short-term market action, he adds.
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