Greg Hirt, chief investment officer of Allianz Global Multi-Asset, Michael Krautzberger, chief investment officer of global fixed income, and Virginie Maisonneuve, chief investment officer of global equities, have just published a commentary on the US election. The bank expects Trump to take a tough stance on trade, immigration and other issues, which could push the dollar and gold higher. The impact on the bond market is harder to predict, while the stock market may see volatility ahead of the election results. If Trump's victory is confirmed quickly, Allianz expects volatility to fall as uncertainty is removed.

Allianz said that Trump's policy focus on lower corporate taxes and further deregulation would be beneficial for US companies, particularly smaller companies with higher valuation appeal, as well as some technology companies that could benefit from Trump's loyalty. The bank said that while Republicans are likely to have won the Senate, a majority in the congressional elections would help Trump push his tax-cut and spending policies. However, the market may worry about the lack of funding for these fiscal policies, which could lead to instability in the credit markets.

Allianz said that Trump's foreign policy would bring greater geopolitical risk compared with a Harris victory, because his geopolitical strategy is unpredictable for both allies and enemies. He is expected to raise trade tariffs against China and some European countries.