Financial markets went on a wild ride Wednesday, as Wall Street index futures and Asian stock benchmarks tumbled on the rising possibility of a Trump presidency.
Shares had been higher early in Asia’s Wednesday trading session but then turned sharply as investors unloaded shares when Donald Trump first gained the lead in the electoral vote count.
A Trump presidency is seen likely to bring added uncertainty on various issues, including trade policies.
Pricing in a possible Trump victory, Dow futures were down 3.8 percent or 687 points at 17,593.00 and S&P futures had dropped 4.6 percent to 2,037.80.
Oil and the dollar tumbled, the Mexican peso sank and gold surged as investors sought a safe haven.
As of 03:00 EST (07:00GMT), Trump had taken 244 electoral votes to Hillary Clinton’s 216.
All regional markets are lower, with money flowing into safe haven stocks, gold and currencies including the yen.
Japan’s Nikkei 225 closed down by 5.4% while European and US markets are expected to drop when trading resumes on Wednesday.
Traders had expected a comfortable Hillary Clinton win.
Some analysts likened the shock of a probable Trump victory to the Brexit result earlier this year.
A Donald Trump win had been widely seen as negative for Asia’s economies because of some of the protectionist rhetoric he’s talked about whilst on the campaign trail. He is viewed as the “great unknown” while Mrs Clinton is seen as an example of “better the devil you know.”
And as that prospect looks more and more likely, many investors in Asia are getting concerned, and the markets are reflecting that.
On the Singapore trading floor where I’ve been all day, things started with cautious optimism that Mrs Clinton might have a significant lead, but that has all changed.
As results trickle in, the first mutterings of “too close to call” began, swiftly replaced by a growing belief that the former reality TV show host would be the next president.
New York Times, BBC