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Key takeaways from the debate
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After the first debate, investors are left with no new information from a policy perspective. The debate may also have an impact on crucial races for the US Senate: the odd of a Democratic sweep rose to 50%. |
Americans found the debate to be messy, incoherent and full of personal attacks. Trump employed a debate tactic calledGish Gallop, a technique that focuses on overwhelming an opponent with as many arguments as possible, without regard for accuracy or strength of the arguments. This was evident during last night’s debate. According to the CBS poll, a whopping 83% found the tone of the debate negative. The poll also found 69% of Americans said the debate made them feel annoyed, while 19% pessimistic. Sadly and tellingly, only 17% felt informed after the debate. Overnight polls found Biden to be the winnerGoing into the debate, Americans expected Trump to be the winner iby a 47-41% margin, with independents favouring Trump by a 47%-37% spread, according to a USA Today/Suffolk University poll taken on August 28-31. This comes as no surprise since Trump lowered expectations on Biden’s performance by calling him “sleepy Joe” and “low energy Joe”. In two instant polls conducted after the first debate, voters felt Biden won. A CBS poll found 48% thought Biden won, 41% chose Trump, while 10% thought it was a tie. The poll asked if the debate made you think better or worse of either candidate, Biden had a net positive +6% (better over worse) while Trump had a -18%. In another poll, CNN found a massive 60% saying Biden won the debate, while just 28% thought Trump won. The RealClearPolitics (RCP) betting average moved in favour of a Biden victory from 55-45% the day of the debate, and by 10 am on the morning after the debate, Biden’s odds increased to 58-42%. The debate may also have an impact on crucial races for the US Senate, where the Democrats hope to take majority control from the Republicans. The RCP odds of a Democratic sweep rose from 49% prior to the debate to 50% immediately after. |
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In the end, Trump needed to change the narrative. His style of interrupting and personal attacks kept the focus on himself and reminded voters why many voters don’t like him rather than making it a binary choice between him and Biden. As a result, Trump failed to change the arc of the race and therefore lost round 1 in the first of three planned Presidential debates. Investment implicationsWith market expectations of a Biden victory having grown since the debate, we could see some market volatility in the coming days as the markets start to factor a Democratic sweep. For further market implications please refer to our last Investment Talks on US presidential election . |
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