Advisor Insights: Election Weather, a Fee War, and Inflation’s Return
Midterms, a Nasdaq correction, and a December rate decision: talking points for this week’s client calls.
This week, advisors faced three significant client concerns: the midterm elections, an AI-driven market downturn, and the return of inflation. On Election Day, Democrats were projected to control both the House and Senate, but despite the political shift, advisors advised investors to keep their plans unchanged. The market reacted to the elections and tech sector turmoil, with the S&P 500 falling nearly 4.4%, and the Dow losing 3.4%.
The VIX jumped to 26.7, and the 10-year Treasury slipped to about 4.84%. The Nasdaq-100 fell more than 10% below its October record, prompting concerns over AI regulation and slowed data-center builds. In response, four funds now track the Nasdaq-100, setting a record for ETF launches. Crypto ETF flows also saw significant outflows, with U.S. spot Ether ETFs seeing a record $1.61 billion of net outflows in October.
The article highlights the need for advisors to focus on clients' individual circumstances rather than reacting to headline events.
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