Hopes push Wall Street to record high
Print Edition
WALL Street hit a record high yesterday as most world markets extended gains on hopes Donald Trump’s plan to kickstart the US economy will succeed.
Tokyo surged nearly 7 percent as Asian markets caught up with a post-election rally elsewhere and European bourses mostly built on Wednesday’s upturn except for London, a touch lower after running into profit-taking.
“Financial markets have swiftly reassessed Trump’s win, embracing it with bullish gusto,” said Mike van Dulken, head of research at Accendo Markets. The dollar firmed after sliding on Wednesday on worries that uncertainty over Trump’s policies would cause the Federal Reserve to hold off an interest rate rise.
Haven currency the yen was a big loser yesterday, slumping to a 3.5-month low at 106.43 yen to the dollar.
“Perception now is that the controversial multi-billionaire TV presenter and property mogul could be good for business; and talk of tax cuts and heavy spending on infrastructure would certainly be good for growth,” said Lee Wild, head of equity strategy at stockbroker Interactive Investor.
World stock markets have recovered from a sharp initial downturn to Trump’s win, with Europe’s leading indices gaining up to 1.6 percent on Wednesday.
In Paris, Vivendi shares were up more than 8 percent after the French media conglomerate returned to profit in the third quarter.
But Renault shares reversed 2.5 percent after a government inquiry into emissions cheating entered a new stage.
The French economy ministry said the country’s anti-fraud unit DGCCRF had submitted its report on diesel emissions by Renault cars to prosecutors.
Asian and European trading screens were initially awash with red on Wednesday as the regions’ investors were the first to react to news the tycoon had defeated market favorite Hillary Clinton.
However, a reassuring victory speech — followed by conciliatory words from Clinton and President Barack Obama — provided some encouragement.
Most markets in Asia yesterday either entirely reversed or clawed back most of the previous day’s losses.
Elsewhere, oil prices eased back as the International Energy Agency said output by OPEC oil producers had reached record levels, raising fears a global crude glut would continue to weigh on markets.
The Mexican peso, which hit a record low 20.78 against the dollar on Trump’s win, also strengthened yesterday but remained under pressure owing to fears about Trump’s policy plans.
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