The Election Playbook for Gold, Stocks, and Bitcoin

Gold and the US Elections: A Sparkling Future or a Fading Gleam?

Farah Mourad

With 2024 marking a golden year for the metal, the upcoming US elections are adding fresh intrigue to an already dynamic environment. Gold has soared amid market fluctuations, central bank rate cuts, and global tensions, reinforcing its appeal as a hedge. But will November’s election results drive it even higher?

Here’s a closer look at the key elements likely to keep gold glittering.

Policy Uncertainty and Gold’s Rally: A 2025 Gold Rush?

Gold has already surged by 33% this year; as demand was spurred on the fluctuating US dollar, investor caution vs. inflation, and escalating geopolitical risks. Central banks’ dovish stances have sparked renewed inflows into gold ETFs, marking the greatest comeback in investor confidence since 2022. As global uncertainties heightened, gold outperformed other commodities helping solidify its appeal as a hedge.

Beyond Rate Cuts

The Fed’s policies remain pivotal. Historically, rate cuts have sparked prolonged rallies in gold, which in previous cycles even extended for 12-24 months. Should this pattern continue, gold’s upward trajectory may be far from over, especially with central banks increasing their gold reserves. Without an unexpected hawkish shift from the Fed, any short-term dips should be fleeting, with strong structural demand to support ongoing gains.

Election Outcomes: Four Scenarios and Their Impact on Gold

Gold’s post-election performance may depend on the policy changes that follow. Here’s how four potential outcomes could influence gold:

1. Democratic Win with Unified Congress: Increased spending could weaken the dollar, potentially lifting gold as credit rating concerns surface.
2. Democratic Win with Divided Congress: A divided Congress could bolster the dollar temporarily, applying slight pressure on gold but preserving long-term upside.
3. Republican Win with Unified Congress: Initial dollar strength could emerge, though fiscal leniency may later introduce credit risks that favor gold.
4. Republican Win with Divided Congress: Minimal policy shifts likely mean muted price movements for gold as major fiscal or foreign policy changes remain improbable.

Election Day

Now, will the US election itself alter gold’s trajectory?

The record shows that election results often create only minor movements: Democratic wins historically nudge gold prices upward by around 0.5% in the first two weeks, while Republican victories see a modest average dip of 1.1%.

While these shifts are worth noting, they don’t typically result in explosive gains. Gold’s real drivers remain the larger economic and policy backdrop rather than any immediate post-election spike.

Seasonal Patterns and Post-Election Outlook

December could bring a rebound, as the combination of seasonal factors and renewed market dynamics come into alignment. Historically, the second and third years of a presidency have delivered the strongest gains, hinting that 2026 and 2027 may be especially favorable for gold investors.

Overall, we expect gold’s allure to shine beyond election day - with market fundamentals, policy shifts, and geopolitical uncertainties likely to keep the metal resilient and poised for longer-term gains.

The chart above highlights gold's historical performance over presidential four-year terms, showing that its largest gains—averaging 12.82% and 11.21%—typically occur during the second and third years. This pattern suggests a strong likelihood for a continued upside, positioning 2026 and 2027 as particularly promising years for gold to potentially outperform.

Nadia ElBilassy

S&P Returns: 10 Year Forecast

Will the S&P returns narrow to 3% over the next decade? Strategists from two of Wall Street's largest banks have arrived at differing outlooks on the future direction of the US stock market over the coming years.

With the S&P 500 Index lingering near historic peaks, Goldman Sachs strategists are cautioning that annual returns may only reach around 3% in the years ahead, constrained by high initial valuations and rising Treasury yields, which might attract investors toward bonds and other assets instead.

In contrast, analysts within JPMorgan Chase’s asset and wealth-management teams hold a more optimistic, will remain a core component of investor portfolios and yield an annualised return of 6.7% over the next 10 to 15 years.

Bright Outlook On Stocks

A recent Bloomberg survey suggests that a win for Vice President Kamala Harris could bring housing cost relief for Americans, while former President Donald Trump’s victory might favor stock and Bitcoin investors. The stock market, already up around 22% this year, is expected to grow faster under Trump’s leadership, with 38% of Bloomberg Markets Live Pulse survey respondents predicting stronger gains in the next year if he wins, compared to just 13% if Harris takes office.

Bitcoin Com

Bitcoin is nearing its all-time high of nearly $74,000, briefly hitting $73,564. With increased demand driven by Donald Trump’s rising odds in election betting markets, as he has openly supported digital assets throughout his campaign.

Join us for live election coverage!

Next Tuesday and Wednesday our YouTube channels will be live streaming market commentary based on the US Election Results. Join Ahmed Azzam, Farah Mourad, Nadia ElBilassy, Raed AlKhedr and special guests for pre- and post-election insights as they come in.

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