Here's what investors are saying about Biden dropping out — and what it means for your 401(k)

President Biden's announcement that he is dropping out of the race for the White House and endorsing Vice President Kamala Harris to be the Democratic candidate has prompted investors and economists to reassess the campaign's impact on everything from the stock market to the so-called "Trump trade."

So far, U.S. markets are taking Biden's announcement to leave the campaign in stride, with the the broad-based S&P 500 index and the tech-focused Nasdaq both rising in Monday trading, partly as Wall Street had already priced in the likelihood of Biden stepping down. But in the near-term, investors caution there could be more volatility in U.S. markets, especially if the race tightens with a new Democratic candidate.

Prior to Biden's Sunday decision, former President Trump had gained an edge in the polls, securing his largest national lead over Biden in the campaign until that point. That tailwind helped spark the Trump trade, which describes a strategy to invest in the assets and stocks that investors believe could profit under a Republican White House, ranging from cryptocurrencies to energy stocks.