Franklin Templeton: Funds Slightly Shift Towards Bonds After the Midterm Elections

Andrew Canobi, the Head of Fixed Income at Franklin Templeton Australia, stated that the initial financial market reaction triggered by the U.S. midterm elections can be summarized as a slight shift of funds from stocks to bonds, reflecting a certain risk-averse tendency.

He added that if the Democrats control Congress, the market may view this as a constraint on U.S. President Trump's growth agenda, particularly in the fields of artificial intelligence and resources. Additionally, as traders believe that the Reserve Bank of Australia may be close to ending interest rate hikes, the yield on Australian three-year government bonds has fallen by 15 basis points since the beginning of this week.