**Trump’s Political Momentum Ignites a Global Surge in Risk Appetite: European Market Overview**
_Source: Adam Button, ForexLive (TradingView.com), with supplemental information from Bloomberg and Reuters_
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The momentum across global financial markets reversed sharply following Donald Trump’s robust performance in the first 2024 US presidential debate. After what had been a week of heavy risk-off sentiment, Friday’s European session saw a dramatic pivot, as investors disposed of safe-haven assets in favor of risk plays. The debate placed Trump’s economic policies at the center of conversation, and traders responded accordingly, rebalancing portfolios to reflect the higher likelihood of a pro-business administration.
This article examines the drivers of this shift, analyzing movements across forex, equities, bonds, and commodities, and explores the broader implications for the months ahead.
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### A Week of Weakness Before a Sudden Revival
The week leading up to Friday had been gripped by caution:
– Persistent concerns over global growth, especially in Europe and China.
– Monetary policy uncertainty from both the Federal Reserve and the European Central Bank (ECB).
– Continued geopolitical tensions, particularly concerning Russia-Ukraine and Middle East unrest.
– Elevated US inflation readings, complicating the Fed’s path to possible rate cuts.
Key European indices like the FTSE 100 and DAX had suffered consecutive losses. US markets closed deeply in the red Thursday, with the S&P 500 recording its worst day since April. Treasuries and Bunds rallied on safe-haven demand, and the US dollar climbed to two-week highs. Among forex majors, the Japanese yen and Swiss franc benefited from risk aversion.
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### Trump’s Debate Performance: The Catalyst
Thursday night’s first US presidential debate became an inflection point for global markets. Viewers and market participants judged Trump the clear winner, with a forceful showing compared to President Biden, who stumbled through significant portions of the event. Traders interpreted this as a shift in the electoral landscape, increasing the odds of a Trump victory in November.
A Trump presidency is widely associated with:
– Aggressive pro-business and deregulatory policies.
– Potential for lower taxation, especially for corporations.
– A preference for robust energy development and less regulatory oversight in finance and industry.
– Tougher trade postures, especially toward China.
This policy outlook encouraged a swing away from risk aversion. According to Adam Button’s live market coverage, “Trump revitalizes risk trades after a heavy slump,” an abrupt wave of buying hit risky assets into the Friday open.
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### European Equity Markets: Strong Bid Returns
Friday’s European session saw sharp gains nearly across the board:
– The Stoxx Europe 600 index was up over 0.8 percent by midday, led by cyclical sectors such as banks, autos, and industrials.
– German DAX advanced by 1 percent, with trade-sensitive and export-oriented names outpacing defensive stocks.
– London’s FTSE 100 climbed as energy and financial shares out
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