The Trump Administration represents a risk to international economic conditions and global sovereign credit fundamentals, Fitch Ratings says. US policy predictability has diminished, with established international communication channels and relationship norms being set aside...

The headwinds to globalisation are more structural than cyclical, which means those in favour of open markets have a serious challenge to overcome.

According to James Butterfill, Head of Research & Investment Strategy at ETF Securities, the Italian referendum yesterday signified a worrying trend for the rest of Europe in confirming the rise of populist parties in the EU, and particularly important given that 70% of Europe have elections in 2017.

In our view, the recent sharp market rotation that we have seen – from “low volatility growth” to “high volatility value” – is a continuation and acceleration of the trend change that has been underway since the third quarter of this year. The turning point for “quality growth” and other hideouts was marked by the Brexit vote.

Global uncertainty to remain as election result signals further rolling back of globalisation themes, with emerging markets likely to see greatest impact. For the US, the Republican sweep in both houses will facilitate Trump's agenda with a focus on domestic growth, spending and fiscal stimulus.