"..US #stocks and other risky assets rallied on Wednesday after Donald #Trump decisive election victory, but bond investors highlighted why euphoria could be shortlived if the president-elect’s campaign policies drive up #inflation..
..The #Russell2000 index of small-cap companies rose even further than the S&P, leaping 5.8 per cent to its highest level since 2021. The advance reflects a belief that small companies, which tend to be more focused on their domestic market, have more to gain from #tax cuts and less to lose from a trade war. The Russell 2000 is also heavily weighted towards financial stocks, which investors are hoping will benefit from looser #regulation and an increase in dealmaking..
.. Invesco’s Hooper said: “I think we are getting much closer to the potential for ‘bond vigilantism’.” This is when bond investors try to force governments to change policy by driving up their borrowing costs. “A showdown could certainly be hastened because of this #election ”
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https://www.ft.com/content/49c08af1-e928-4df0-b5a1-a8662c382a8d