AXA IM: What are the possible indications of this election year for financial markets?

AXA IM: What are the possible indications of this election year for financial markets?

2 februari 2024

Politiek Geopolitiek
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Voters from more than 60 countries will head to the polls this year, representing almost half the world’s population. This makes 2024 perhaps the ultimate election year by historical standards.

The act of merely holding elections does not guarantee a free and fair process e.g., Russia’s March elections, nor does it imply consequential change. Yet financial markets’ sensitivity to politics has increased since the 2008-2009 global financial crisis, particularly in advanced economies. Researchers from AXA IM gathered the possible indications.

Key points

  • The US Presidential election is likely to be the most consequential; a rerun of the 2020 Biden vs. Trump contest looks most likely, but alternatives are still plausible.
  • European Parliament and UK elections are likely to have less global significance, but will impact policy going forwards.
  • Geopolitically-sensitive general elections took place in Taiwan in January – the Democrats achieved a historic third consecutive Presidential victory. We continue to monitor China’s reaction.
  • Policy continuity is expected in major emerging markets such as Indonesia, India and Mexico. South Africa’s ANC party may lose its Parliamentary majority for the first time since apartheid and Turkey’s local elections will test the country’s commitment to orthodox policies.
  • In frontier markets, Panama faces an uncertain outcome and Senegal is looking at a fraught election process.

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