July is normally a slow and eventless month for news, even with the tight race for the U.S. presidency and the Republican convention beginning earlier this week. However, the assassination attempt on former President Donald Trump this past Saturday sparked the news and media cycle into overdrive.
Saturday night we were all left in shock and disgust at this assault and senseless loss of life. But come Sunday morning, the American news/media focused on what impact this event will have for the election and everything associated with it; including the economy and capital markets.
The chart below lists different presidential shocks and the impact it had on the market. The data shows that despite the shocking event and wide range of outcomes, the market has always recovered. “The U.S. equity market tends to react to shocks negatively, falling a median of 4% over the first nine days and then typically recovering the full amount of that loss another seven days following the shock.” – Market Update by RBC Global Asset Management.
Though this overwhelmingly sad and violent act is not acceptable, it is one that shocks and could impact the market. As we look back through history to similar shocking events, fortunately there is one consistent theme, the markets always recover. By Monday morning the markets seem to have ignored the event and still hit all-time highs.
Our thoughts and prayers are with the families that suffered from this tragic event.
As always, if you have any questions or concerns about your portfolios, please reach out.
Have a great weekend,
Tracey and Paige
Source: https://www.rbcgam.com/en/ca/article/market-update-shocking-and-senseless-attack-buthistory-indicates-limited-sustained-impact-on-stocks/detail
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