Politics, bullets and stability

POLITICS in the United States is roiling markets. Less than one month after a disastrous TV debate, American President Joe Biden has decided not to run for re-election and has ceded support to his vice-president, Kamala Harris. Just on Jul 13, a bullet grazed former president Donald Trump and chances have increased that he might again be back in the White House.

Some immediate reactions seem to treat such an outcome not merely as “what if”, but a question of “when”. Following Trump’s statements about Taiwan, for example, stocks of Nvidia, Taiwan Semiconductor Manufacturing Company and other chipmakers slid downwards. The Philadelphia semiconductor index, a Wall Street composite indicator, shed some US$480 billion in one day. On the flip side, cryptocurrencies picked up.

Then, as support rallied around Harris, the broader US market inched upwards. Still, she has yet to officially secure the Democratic Party nomination and, while polls suggest Harris has better prospects than Biden in the November election, questions remain whether a female and minority-race candidate can win.