You might be the type of person that prefers to stay out of politics, but these days, it is probably pretty hard to ignore. As you probably are well-aware, 2024 is a big election year in the United States. However, you may not have realized that this year will host many big elections all over the world. Politics and policy changes can create some big swings in the markets.
Countries across the globe that are home to more than half the population and make up 60 percent of the world’s economic output will be holding elections this year. In Europe: Portugal on March 10, Belgium on June 9, the European Parliament from June 6-9, Croatia during the autumn and winter months, Romania in November, and Austria.
Russia will hold elections on March 17. It is nearly certain that Vladimir Putin, who was first elected in 1999, will be elected to another six years of presidency. Polls show his approval ratings around 80 percent. The risks associated with this include the war in Ukraine, as well as Putin’s warnings against the West concerning both the war and the election. There are also economic factors to consider. Russia’s economy has been boosted by defense spending for the war, but there have been significant depreciation in the value of the Russian ruble (the Russian currency) which has forced interest rates higher.
Turkey will hold a local election on March 31. India will also hold elections during April and May. India is a key commodity exporter and they have restricted the exports of rice, wheat, and sugar amidst a battle with inflation. Mexico’s presidential election will be on June 2 and it will also include a full Congress reshuffle and nine state elections. South Africa’s election will take place from May to August, and the ruling African National Congress is at risk of losing its parliamentary majority for the first time since 1994 when Nelson Mandela led it to power. Britain’s election is expected to end by the end of this year and is due by January 2025. Venezuela will hold elections in 2024 as well.
The United States Presidential Election is on November 5. The US is the world’s largest economy, and we are still trying to avoid a recession following aggressive hikes in interest rates. The US Dollar could become volatile because of election probabilities, and as the dollar moves in comparison to other currencies, this could impact exports. US and China tensions are still at the forefront of many minds. Not only is that relationship a risk to stocks, it could also create barriers with trade and tariffs as well as impact other currencies around the world.
Foreign policy doesn’t typically play a huge role in US presidential elections, as voters are more concerned with domestic issues. However, with the wars in Ukraine and Gaza still going on as well as China’s aggressive behavior, foreign issues are definitely becoming a hot topic in the presidential campaigns. Positions that the United States takes against countries such as Russia, China, and Iran could have big impacts on our markets, as well as policies enacted by newly elected leaders in other countries around the world.