What a Trump presidency could mean for commodities? JPM says gold stands out as winner

seekingalpha07-18

While there is a lack of a clear pre-election trade given the range of scenarios that could play out, gold stands out as a winner, JPMorgan said in a note titled '2024 US Election Watch—Reassessing ...

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JPM says gold stands out as winner","media":"seekingalpha","content":"<div>\n<p>While there is a lack of a clear pre-election trade given the range of scenarios that could play out, gold stands out as a winner, JPMorgan said in a note titled '2024 US Election Watch—Reassessing ...</p>\n\n<a href=\"https://seekingalpha.com/news/4124971-what-would-gop-control-of-all-washington-levers-of-power-mean-for-commodities-jpm-answers\">Source Link</a>\n\n</div>\n","source":"seekingalpha","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>What a Trump presidency could mean for commodities? 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JPM says gold stands out as winner\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-07-18 17:53 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/news/4124971-what-would-gop-control-of-all-washington-levers-of-power-mean-for-commodities-jpm-answers><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>While there is a lack of a clear pre-election trade given the range of scenarios that could play out, gold stands out as a winner, JPMorgan said in a note titled '2024 US Election Watch—Reassessing ...</p>\n\n<a href=\"https://seekingalpha.com/news/4124971-what-would-gop-control-of-all-washington-levers-of-power-mean-for-commodities-jpm-answers\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"PSLV","symbol_name":"Sprott Physical Silver Trust","start_time":0,"source_url":"https://seekingalpha.com/news/4124971-what-would-gop-control-of-all-washington-levers-of-power-mean-for-commodities-jpm-answers","article_id":"2452033711","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1388392197/image_1388392197.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2452033711","pubTimestamp":1721296388,"columns":[],"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"While there is a lack of a clear pre-election trade given the range of scenarios that could play out, gold stands out as a winner, JPMorgan said in a note titled '2024 US Election Watch—Reassessing im","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"PSLV":"Sprott Physical Silver Trust","COPX":"铜矿ETF-Global X","UNL":"United States 12 Month Natural Gas Fund LP","LU1244550577.SGD":"FTIF - Franklin Global Multi-Asset Income A (Mdis) SGD-H1","CORN":"Teucrium Corn Fund","LU0211326839.USD":"TEMPLETON GLOBAL INCOME \"A\" (USD) INC","SGOL":"abrdn Physical Gold Shares ETF","AAAU":"Goldman Sachs Physical Gold ETF","FCG":"First Trust Natural Gas ETF","DRIP":"Direxion Daily S&P Oil & Gas Exp. & Prod. 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The odds of a second Donald Trump presidency are mounting following a failed assassination attempt and his strong debate performance, with Wall Street preparing for the possibility of sticky inflation, protectionist trade policies, and higher long-term bond yields if he wins the election. For precious metals: Fed cuts offer gold a more traditional tailwind pre-election, while a Red Wave could ignite a potent, bullish mix of tariffs and geopolitical tension, and fiscal debt expansion that steals the spotlight once again in 2025, JPM notes. Gold prices scaled another record amid increasing expectations of Fed cutting interest rates in the coming months. On top of a recent recoupling with falling yields, the increasing probability of a Trump 2.0 presidency is likely also bolstering gold’s longer-term appeal in our opinion, JPM analysts said. The investment bank has been structurally bullish on gold and silver since 4Q22, and continues to see owning both into the election as one of the highest convicted trades across commodities. ETFs: (GLD), (GDX), (GDXJ), (IAU), (NUGT), (PHYS), (GLDM), (AAAU), (SGOL), (BAR), (OUNZ), (SLV), (PSLV), (SIVR), (SIL), (SILJ) Oil: Trump intends to reduce inflation by increasing domestic U.S. oil production by 3 mbd via deregulation, and JPM estimates the equilibrium price of WTI oil at around $70/bbl, and believes that even at $60/bbl, prices are too low to incentivize production, potentially leading to a spike to $100/bbl in the following year. According to the investment bank, to increase U.S. oil production by 3 mbd, the Trump administration would likely open the Gulf of Mexico and Alaska for further exploration and development, and to restart drilling in Alaska’s Arctic National Refuge, Trump would reverse a move by the Biden administration to cancel leases in the region.  ETFs: (USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI), (UNG), (BOIL), (KOLD), (UNL), (FCG) Natural gas: A Red Wave congressional sweep could have an even more bearish price impact on U.S. and global natural gas balances by raising the likelihood of a faster increase in production from oil plays while even more certainty can be placed in swift end to the Russia/Ukraine war, lending to an increased potential for curtailed Russian natural gas supply making it back to market, JPM notes. U.S. Production: With JPM's current base case for oil production to grow 2.4 mbd by 2028 – split +870 kbd of crude and condensate and +1.55 mbd of NGLs, associated natural gas production is likely to grow ~7.2 Bcf/day. Base metals: Significant tariff escalation risks undercutting a bullish fundamental copper set up in 2025 under Trump 2.0, but sequencing of policy priorities would become much more important under a Red Wave scenario. ETFs: (COPX), (CPER), (OTC:JJCTF) For agricultural markets: Brokerage anticipates stronger U.S. growth, lower on-farm input costs and an eventual cease fire in Ukraine, which will take time to materialize into a normalization of agri export flows. \"China’s forward purchase commitments of U.S. ag products are already at very low levels. We see value in long vol positions across the complex and on an index wide basis off the current lows, favoring sugar as an underlying.\" ETFs: (CORN), (SOYB), (WEAT), (DBA), (MOO) Dear readers: We recognize that politics often intersects with the financial news of the day, so we invite you to click here to join the separate political discussion.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"policyRegulatory","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2452033711"}