One Year on from Trump: How have the Markets Fared?

Twelve months on from Donald J. Trump being elected as the 45^th President of the United States, Fidelity International reveals the best and worst performing asset classes since the shock result.

On 8^th November 2016 the world woke up to the news that Donald Trump had won a bitterly fought election battle to be elected President of the United States. Many investors at the time expected the markets to slump following the outcome of the election, resulting in a flight to safe haven assets.

However, markets have defied the initial expectations and continued their steady rise over the past year. Equities in particular have gone on to deliver some impressive returns while safe haven assets have lagged behind.

For example, since November 2016, US equities have gone on to deliver a 15.04% return meaning that had you invested £10,000 in the S&P 500 it would now be worth £11,504.*

However, it’s European equities that have delivered the best returns since Trump was elected and had you invested £10,000 you would now have £12,263 – a return of 22.63%.*

Asia Pacific equities have followed closely behind, returning 20.36% over the same period while emerging market equites have also had a surprisingly strong year under President Trump, delivering a 19.79% return. A £10,000 investment in each of these twelve months ago would now be worth £12,036 and £11,979 respectively.*

Best and worst performing asset classes over the past twelve months:

Source: Fidelity International sourced from Datastream, November 2017. % Total returns in GBP 07/11/2016 to 31/10/2017

Tom Stevenson, investment director for Personal Investing at Fidelity International, comments: “As with the EU referendum, the result of last year’s US election was a major surprise. However, unlike with Brexit, the initial reaction from the market was relatively measured and investors have remained optimistic throughout the first year of the Trump Presidency.

“In fact, despite concerns about the delivery of radical economic reforms, a number of major markets have gone on to hit record highs under President Trump. Much of this has been driven by an improving global economic backdrop, particularly in Europe and Asia where we have seen strong growth.

“Had you set up and held a well-diversified equity portfolio, as our analysis shows, it would have delivered respectable returns over the past 12 months. The gains from shares have more than made up for any losses from bonds, as the interest rate environment has tightened.

“For anyone looking to build a diversified portfolio, a global equity fund remains a good starting point and will be a sensible core holding for most investors. We continue to like both the Rathbone Global Opportunities Fund and Fidelity’s Global Special Situations Fund.”