FXStreet reports that economists at HSBC remain constructive on the US economic outlook, on further fiscal support and loose monetary conditions but electoral uncertainty may cause some near-term market volatility.

“In most scenarios, further pandemic-related fiscal support remains likely. This provides a constructive backdrop for US risk assets amid the ongoing economic recovery and loose financial conditions, supported by the Fed’s ‘lower-for-even-longer’ monetary policy.” 

“We believe fresh government stimulus measures could benefit cyclical parts of the market which have lagged in their performance this year and look relatively attractively valued. Strong US consumer demand may also support other global equity markets, particularly those geared to exports.”

“In the event of a delayed or contested election outcome, risks assets could experience some volatility in the near term. Other key near-term risks to the economic and market outlook also require monitoring, particularly virus-related developments.”