Trump guilty verdict seen as a ‘more severe outcome than anticipated’

A recent unanimous guilty verdict on all charges against former President Donald Trump has been described as a “more severe outcome than anticipated,” according to a note from research firm Vital Knowledge.

The firm explained that initially, many expected Trump would be found guilty on some counts, particularly the misdemeanor charges related to falsifying business records, but the comprehensive guilty decision surprised observers, said the firm.

This development has significant political implications. “Dems had reached panic mode (again) in the last several days, and this guilty decision will likely have a State of the Union-like effect on some of the polling figures in the coming days and weeks,” Vital Knowledge noted, suggesting that it may benefit President Biden’s polling numbers.

However, despite multiple polls indicating that a guilty verdict would damage Trump politically, the New York case is considered the least consequential among the four he faces, potentially muting its overall impact.

Vital Knowledge also highlighted that it is unlikely verdicts in the other cases (in DC, Florida, and Georgia) will be reached before the November election, though the DC trial might start before then.

For markets, the immediate impact of the verdict is said to be minimal. “While the verdict is a small positive for Biden, it’s hardly decisive, and the November race will still be very close,” the firm stated. They advised attention to ongoing corporate earnings reports, with companies like Dell (NYSE:DELL), MongoDB (NASDAQ:MDB), and Veeva experiencing significant after-hours trading losses.

Elsewhere, analysts at Raymond James said the verdict immediately raised questions about the impact of the presidential election.

“We view the Presidential election as close, but with Trump with a narrow lead,” wrote the firm.

When it comes to the impact on the market, Raymond James noted that the presidential race has been “remarkably static for most of the year,” and they have not yet seen many investors making bets on the outcome for their portfolio.

“Memorial Day frequently serves as an unofficial start to the election and with this verdict and upcoming debates, we expect greater market reaction to potential 2024 election outcomes,” added Raymond James analysts.