Biden’s Out: What Does It Mean for Markets?

The withdrawal of Joe Biden from the US presidential election is likely to reverse the “Trump trades” that have been a focal point since Biden’s debate difficulties and the assassination attempt on Donald Trump on July 13. Kamala Harris, who is now the leading Democratic candidate, is perceived to have a higher likelihood than him of winning the election. Although there remains a slim chance that Democrats could nominate a more favorable candidate, this would dramatically alter the election dynamics. Until new polls are conducted and the Democratic succession is clarified, Trump’s probability of winning, previously estimated between 70% to 80% in election models, is speculated to drop to around 55%.