The S&P 500 hit a record intra-day high today, also breaking a major technical resistance level. This shows more upside in the US markets, all things remaining equal. But it would be wise not to look away from the rest of the global economy. The US election has captured the headlines and attention of markets and will be a formidable force in markets for some time.

Italy is going to have their Referendum in 2 weeks time, which could be another blow to the unit of the EU in budget balancing. The EU is already facing populist factions that want to have their own 'Brexit' moment, and a lot of the resentment is a byproduct of low growth.

China has restricted lending to real estate developers, which is starting to be seen in the home numbers, and soon GDP. How well the Chinese government manages the decline in home prices will have a larger impact on commodity prices than any type of stimulus plan or inflation trade that may come to fruition in the new administration.

​The optimism in the US is hard to ignore, let alone short, but it is more important now to look at external factors to be the 'out of left field' news that shakes the mood in the US. 

A surprise Trump victory in the US cause overnight market turmoil. US futures were down 5% as the results started to show Trump taking the lead. We have now gone 50 bps positive on the S&P and markets seem to have shrugged off all of the fears that caused the market declines last week.

Looking longer term I wonder how much of this is attributable to the expectation of easing by the Fed as a result, short covering, or cash coming back in after the uncertainty cleared. This week could be an opportunity to look positioning for the road ahead in 2017 and what factors could shape perception. 

• Inflation expectations (Fed members are talking all this week)
• Article 50 and Brexit by March
• Mounting Chinese debt 
• Political shifts in Europe
• Geo-politics in Europe and Asia

This week started out with an early example of how much the markets will dictated by US elections. With news that the FBI stood by its previous decision to not charge Hillary Clinton over her E-Mails, markets have spike considerably. The Dollar has also gained some ground. This goes to show the amount of volatility that will be seen in the next couple of days, not to mention after the results of the election.

The results of the election could move markets significantly, especially with a Republican win of Donald Trump. This will be due to the uncertainty that a Trump presidency will bring, look at the reaction of the Mexican Peso as a clear example of market participants ebbing and flowing around this prospects. But more importantly is to look longer term, into the next year, where the markets have not been too busy to look. There will no doubt be winners and losers in the immediate aftermath of the election, but how does the next year look in terms of global growth, politics in Europe and Japan, and Debt concerns in China.

​The election could change the market paradigm, but if we get the status quo, markets will look to a new paradigm. Many pundits and hedge fund managers are talking about the valuations of the market being too high or having room to grow. The reality of the market's current valuation will be judged from the view of the landscape after the fog of the election is gone.