Donald Trump’s election win did not cause stock market crash

Contrary to market expectations that a win by Donald Trump would lead to a mini stock market crash, the US stock market ticked higher in the 3 days after the US election. The Dow Jones industrial index looked set to open 4% lower on Wednesday morning after Trump’s win was confirmed but reversed early losses to close 1.4% higher for the day. Although this bizarre intraday swing was difficult to explain, investors took comfort from Trump striking a conciliatory tone in his victory speech and his pledge to boost US economic growth via tax cuts and substantially higher government spending on infrastructure projects in order to create jobs. US banks, pharmaceuticals and construction companies rallied following Trump’s economic pledges while utilities and technology stocks sank. Trump’s economic policies are seen as leading to higher interest rates which is good for bank stocks. It remains to be seen whether the unexpected euphoria caused by Trump’s win will last given the ongoing uncertainty about his ability and commitment to implement his economic and social reforms.