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Five powerful figures who can affect the markets

Ben Weiss, Wednesday, 3 July 2019

Five powerful figures

A president, a social influencer and an eccentric engineer… it sounds like the start of a bad joke. But all these have one thing in common when it comes to trading; they all have the potential to affect the markets in a pretty big way. Find out who we think has the greatest influence on the markets. 

Donald Trump

An unsurprising addition to kick this list off is the leader of the largest economy in the world, US President Donald Trump.

He has truly revolutionised, or maybe de-evolved, the way Presidents interact with the public. Where it was once all about staying within PR boundaries, official press conferences and tailoring yourself to be as inclusive as possible, Trump instead uses Twitter to instantly deliver his thoughts to the world. His tweets seem void of censorship and Trump is notorious for not being able to bite his tongue. He fully backs what he believes in and is happy to alienate large groups, sometimes even nations, at a time if he believes that he’s right to do so.

But its his willingness to broadcast on Twitter that has stirred the pot. From nuclear tensions with North Korea to arguing with women footballers, the US President rarely holds back. Its benefit is that it provides the public with unique insights. But what that also means is that billions of people across the world can instantly access information from the leader of the world’s most powerful economy.

When the trade war negotiations with China came to an abrupt halt, rather than hear second hand what went on, we got to read it from Trump directly. Equally, the North Korean tensions weren't exactly ignited on Twitter, but fuel was definitely added to the fire on the social platform courtesy of a number of ill-tempered tweets. 

How's this relevant? One tweet coming from such a powerful source regarding serious world issues has the potential to plunge the markets into chaos.This has happened on numerous occasions during Trump's tenure, most recently with his tweet about the G-20 summit influencing the Dow. 

Mark Carney

As the Governor of the Bank of England, Mark Carney can have a great impact on exchange rates. With the Monetary Policy Committee, headed by Carney, deciding where to set interest rates, they can ultimately affect the pound’s value against other currencies.

In the group of nine members, Carney has the final vote on monetary policy. His undoubtable influence will also mean that he may be able to convince other members of voting in his favour.

Overall, the Governor of the Bank of England has a crucially important job, and part of that directly correlates with forex pairs. Due to the stature of his job, his opinions carry a lot of weight. Carney is effectively the most senior economist in the country, and his decisions will have a direct impact on the markets – specifically involving the pound. 

 

Elon Musk

He’s now known as Tesla’s founder and CEO, an ambitious inventor, simulator-theory believer and eccentric flamethrower seller. But he was once just a student, albeit a very clever one, studying engineering. In essence, he still is primarily an engineer, but his entrepreneurial escapades have planted him firmly in the public spotlight for his business adventures instead.

His brilliance when it comes to inventing, marketing and what he generally offers to the public have made him a well-trusted figure of influence. He is an advocate of cryptos and some even call him the 'unofficial poster boy.’ Having such a well-respected figure as a backer can offer confidence to those deliberating whether to invest in cryptos. Were he to suddenly to make a u-turn and denounce them, the sentiment of those who have invested based on Musk’s opinion may also change. 

His intelligence and successful ventures across industries has meant he's become an authority figure, so any comment he makes holds weight and can have a subsequent effect on those industries. Of course, he has a huge effect on Tesla's share price as well. 

 

Warren Buffet

Most people will have heard of Buffet’s name when it comes to investing. He is the old-school genius who made an awful lot of money in investing and has been telling his tale ever since. Buffet is widely considered one of the most effective and well-known traders of all-time. He’s to investing what David Beckham is to football, Oprah is to chat shows, Spielberg is to film.

As someone who has very much been there and done it, Warren Buffet’s opinions hold much respect and authority in the trading world. Several traders hang on his every word as they try to emulate his investment strategies and try to recreate his success.

 

Kylie Jenner

From Warren Buffet to Kylie Jenner, two people who reside on very opposite ends of most spectrums. Strangely, the latter has perhaps more influence than the investment legend. As one of the most influential personalities around with 27.6 million Twitter and 139 million Instagram followers, Jenner demonstrated her influence when an Off-the-cuff tweet in 2018 saw Snapchat lose £1.3 billion.

Based on sheer numerical influence alone, Jenner has the power to directly impact sales. With a combined social following of over 167 million, her potential outreach is huge. At the very minimum, she has over 111 million unique followers (some may follow her on both platforms), so if just 0.1% of her unique followers buys a £20 product that she tweets about, that will generate £2.2 million in revenue alone. If 10% buy a £50 product, that figure rises to £555 million.

That is based on sales alone, but when thinking about the brand awareness, advertising and any future purchases her followers may make as a result of the initial purchase, it’s clear that any popular figure with a solid following of this stature can severely hinder or boost a company’s sales.

Of course, positive/negative exposure plus a rise/fall in sales will have a knock-on affect on a company’s share price, which is where the influence on trading and markets comes into it. Snapchat learned the hard way. But it’s clearly imperative for companies to keep social influencers on side.

 

 

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