World News – UA – Global Whipsaw Stocks and Bonds Rally as US Votes Anxiety

E-Mini futures for the S&P 500 swung wildly between negative and positive and ended at 036% EUROSTOXX 50 futures lost 05% and FTSE futures 08%

Asian stock markets turned temperamental and S&P futures wobbled on Wednesday following US results The presidential election showed a terribly close race with no clear winner still in sight

Investors initially bet that a possible Democratic sweep of Joe Biden could ease political risk while promising big fiscal stimulus, hitting the dollar and safe haven bonds

But the mood quickly calmed over signs that President Donald Trump may well wrest Florida away and was much closer in other major battlefield states than the polls had predicted (Who Wins ? Click)

« In a typical risk-driven election, it’s the stairs up and the express elevator down, as early results, especially in Florida, move away from the quick result sought by Biden Markets, « said Stephen Innes, Chief Global Markets Strategist at Axi

Instead, investors now hedged themselves against the risk of a contested election or at least a protracted process as postal ballots were counted

This saw 10-year T-bill yields fall as low as 080%, from a five-month high of 093% The 7bp drop on the day was the biggest since mid-May

E-Mini futures for the S&P 500 swung wildly between negative and positive and were the last at 036% EUROSTOXX 50 futures lost 05% and FTSE futures 08%

Japan’s Nikkei was still ahead by 14%, but the largest MSCI index of Asia-Pacific stocks outside of Japan fell 06%

« I think the odds of a clean (Democrat) sweep are dwindling, almost by the minute. This reduces the possibility, or at least the likelihood that a big stimulus package will be agreed upon in the first few days of a Biden administration « 

The US Dollar also reversed early losses and climbed 1% on a basket of currencies to 94071 The euro fell back hard to $ 1 1634 and away from a high of $ 1 1768

Investors are still awaiting the results of the Federal Reserve and Bank of England meetings this week, which should at least give a nod to further stimulus

The Reserve Bank of Australia cut interest rates to near zero on Tuesday and stepped up its bond buying program, adding to the tidal wave of cheap money flooding the financial system worldwide

Gold had recently been supported by all that liquidity, but hit some profit taking on Wednesday, losing 11% to $ 1,886 an ounce

US crude rose 43 cents to $ 38.09, Brent futures also gaining 43 cents to $ 4014

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Stocks, Bonds, Stock Exchange, Joe Biden, Donald Trump