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Category: Stockmarket / Currency / Futures / Markets / US Elections

US markets rise in anticipation of Clinton win over Trump

Wednesday, 9 Nov 2016 05:51:45 | Sue Lannin

Republican nominee Donald Trump and Democratic nominee Hillary Clinton speak during the first presidential debate at Hofstra University in Hempstead, New York on September 26, 2016.  (Timothy A. CLARY / Jewel SAMAD / AFP)

US stocks made modest gains, rising for the second day in a row, as North Americans elect a new president with investors betting that Democratic Party contender Hillary Clinton will beat her Republican rival Donald Trump.

Markets at 8:30am (AEDT):

  • ASX SPI 200 futures +0.5pc at 5,269
  • AUD: 77.77 US cents, 70.54 euro cents, 62.86 British pence, 81.70 Japanese yen, $NZ1.0494
  • US: Dow Jones +0.4pc at 18,332, S&P500 +0.38pc at 2,140, NASDAQ +0.53pc at 5,193
  • Europe: FTSE +0.53pc at 6,843, DAX +0.24pc at 10,482, Eurostoxx50 +0.47pc at 3,023
  • Commodities: Brent oil -0.91pc at $US45.73/barrel, spot gold -0.46pc at $US1,1275.41/ounce, iron ore +$US1.00 at $US67.80/tonne

The volatility index, or VIX, which measures investor anxiety, rose at first before at one stage falling more than 4 per cent, having posted its biggest one-day plunge since late June on Monday.

Just before 8:30am (AEDT) it was down nearly 1 per cent.

The Mexican peso increased to a two-month high of 18.66 against the greenback ($US0.05438 per peso) on expectations of a Clinton win.

The peso is seen as a proxy for investor sentiment towards the US election and support for Donald Trump, whose policies are seen as negative for the Mexican economy because most of Mexico's trade is with the US.

Another barometer of support for Donald Trump, the iShares MSCI Mexico ETF - which tracks a broad based index of Mexican stocks, rose nearly 2 per cent to its highest level since August.

In a morning note, ANZ economists said investors seemed confident that Mrs Clinton would win the election.

"The glass is half full, with markets continuing to position for a Hillary Clinton victory," they wrote.

"Global equities are rallying, treasuries are higher, gold is down."

But they sounded a note of caution, with the shock of the Brexit vote in the UK still weighing on their minds.

"Regardless of the result today, the increasingly unpredictable nature of elections is sending an important message," they added.

"The global backdrop remains one of rising debt, slow growth, limited reform, a gulf between asset and wage inflation, and rapid technological change.

"The US is hugely divided, the path to 'healing' is not clear, and there is a wider global resentment vote thematic to appreciate."

The Dow Jones Industrial Average also ended higher after a weak start to trade.

Although rental car firm Hertz, saw its shares drop by half after the company reported weak quarterly earnings and cut its profit forecast for the financial year.

Hertz operates Hertz, Dollar and Thrifty rental car chains.

Hertz shares ended down 22 per cent to $US27.70.

Aussie dollar jumps ahead of US results

In Europe, markets also finished modestly higher.

The FTSE 100 rose half a per cent to 6,843.

The DAX in Germany and the CAC 40 in Paris also recorded modest increases.

AB Foods, the owner of discount retail chain Primark, posted better-than-expected results.

It said it expected to benefit from the UK's decision to leave the European Union.

AB Food shares rose nearly 6 per cent to 2,648 pence.

Iconic retailer Marks and Spencer announced plans to close 60 clothing stores in the UK, although it will open food stores instead.

On commodities markets, spot gold edged higher but then lost ground.

Oil prices were mixed as investors waited for the result of the US presidential election.

West Texas crude oil rose to $US44.91 but Brent crude fell after estimates of record output from major oil producers which are members of OPEC.

OPEC forecast that oil demand will increase over the next three years.

The cartel's producers meet at the end of the month to discuss a cut to production.

The Australian dollar surged against the greenback heading towards 78 US cents.

Today's agenda:

Australia:

  • Westpac/ MI consumer confidence - November (10:30am)
  • CBA AGM (10:30am)
  • Flight Centre AGM (10:00am)
  • Fortescue AGM (1:00pm)
  • Medibank Private AGM (10:00am)
  • Ramsay Healthcare AGM (10:00am)
  • Seven West Media AGM (1:00pm)

China:

  • Inflation, producer price index - October (12:30pm)

US:

UK:

  • Trade balance - September (8:30pm)
All times AEDT

AustraliaPlus


 

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