The Week Ahead: All eyes on Trump’s health ahead of Nov 3 presidential election

TheEdge Mon, Oct 05, 2020 02:00pm - 7 months ago

US stock futures and European markets slipped after US President Donald Trump announced that he and his wife Melania have tested positive for Covid-19. The announcement came less than 48 hours after his first presidential debate with Democratic party nominee Joe Biden.

In the coming week, Bursa Malaysia is expected to take its cue from the performance of the Dow Jones Industrial Average and the S&P 500, as well as developments in the currency and commodities market.

Given Trump’s condition, the focus over the coming weeks will be on his health as the US presidential election is less than a month away on Nov 3.

According to the Financial Times, after the first debate — moderated by Fox News Sunday anchor Chris Wallace and described as chaotic — Biden is ahead of Trump in the main battleground states. The status of the second and third debate slated for Oct 15 and 22 remains unclear.

UOB Global Economics & Markets Research highlights that 74-year-old Trump is at a higher risk of serious complications from the virus. Citing a Brookings report from July, the research house said the first course of action is for those in the line of succession to be protected, that is Vice-President Mike Pence, followed by Speaker Nancy Pelosi, Senator Chuck Grassley and members of the cabinet.

Second, it said that it would be important for the president (especially if he is mildly symptomatic or asymptomatic) to continue to communicate with the American public to “restore faith in his wellness, calm nervous Americans, stabilise stock markets, and project to the world that the president remains well enough to execute the office”.

The US Constitution allows Trump to hand over control to the vice-president and then to reclaim it as soon as he declares himself able. It also allows the vice-president and cabinet to execute the transfer of presidential power in case Trump’s condition worsens or he has to be sedated for intubation.

Meanwhile, the sole debate between current vice-president Mike Pence and Biden’s running mate, Kamala Harris, is set for Wednesday, Oct 7. The 90-minute debate will be moderated by Susan Page of USA Today.

Apart from that, the US will be releasing its August trade balance on Oct 6. Bloomberg estimates a bigger deficit of US$66.1 billion (RM275.2 billion) from US$63.6 billion in July.

Across the causeway in Singapore, Deputy Prime Minister and Finance Minister Heng Swee Keat is scheduled to deliver a ministerial statement and table a Supplementary Supply Bill in parliament on Monday, Oct 5. The bill will cover the support measures announced in August. Heng will also provide an update on Covid-19, an update on the government’s fiscal position and strategies post-Covid-19. Singapore is also scheduled to release its Markit PMI Survey and August retail sales data on Monday followed by September foreign reserves data on Wednesday.

China’s week-long National Day Holiday, also called the Golden Week Holiday, has commenced and will continue until Thursday. China will release its September foreign reserves data on Wednesday, which Bloomberg estimates at US$3.174 trillion from US$3.165 trillion in August. The world’s most populous nation is also set to release the Caixin September services Purchasing Managers’ Index on Thursday.

The Reserve Bank of Australia (RBA) will make its monetary policy decision on Oct 6. Citing a Bloomberg poll, UOB says that nine out of 11 economists expect RBA to keep the rate unchanged at 0.25% while the other two economists expect a 15-basis-point cut. UOB, meanwhile, does not expect a change, saying “we believe RBA governor Philip Lowe remains unenthusiastic about negative interest rates”.

Markets in Australia will be closed on Monday for the Queen’s birthday while markets in Taiwan will be closed for National Day and South Korea for Hangul Day on Oct 9.

On the domestic front, Datin Seri Rosmah Mansor’s solar graft trial is scheduled to continue on Monday. The prosecution has three witnesses left to take the stand. At the same time, the 1Malaysia Development Bhd trial of former prime minister Datuk Seri Najib Razak is expected to continue with the cross-examination of the company’s ex-CEO Mohd Hazem Abdul Rahman.

Meanwhile, the Federal Court is expected to hear the merits of Tan Sri Musa Aman’s challenge against Datuk Seri Mohd Shafie Apdal on the lawfulness of the latter’s appointment as the Sabah chief minister, the outcome of which may raise questions on the legality of the state election that was held on Sept 26 or whether the matter is only academic in nature.

On the corporate front, Main Market-bound home improvement retailer Mr DIY Group (M) Bhd will launch its prospectus on Tuesday.

Companies that will be holding annual general meetings this week include Bermaz Auto Bhd and Analabs Resources Bhd on Oct 8. D’nonce Technology Bhd and Dynaciate Group Bhd (formerly known as Tatt Giap Group Bhd) will hold theirs on Oct 9.

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