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Tuesday, July 23, 2024
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Futures tumble as Trump opens path to White House

Supporters of Democratic presidential nominee Hillary Clinton watch and wait at her election night rally in New York, U.S., November 8, 2016. REUTERS/Carlos Barria

U.S. stock index futures tumbled on Tuesday as the path to victory for market favorite Hillary Clinton narrowed after Ohio was called for Republican Donald Trump, putting him on a stronger course to win the U.S. presidential election.

Trump and Democratic rival Clinton remained in close battles not only in traditional battleground states, but also in some states expected to have been in Clinton’s column like Michigan and Wisconsin.

Some networks called Florida and North Carolina for Trump.

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Financial markets reacted violently to the results, with S&P futures down more than 4 percent and Dow Industrials futures falling more than 700 points.

Wall Street has seen former Secretary of State Clinton as a status quo candidate who would lend stability to the markets, while Trump’s stances on foreign policy, trade and immigration are seen sparking volatility.

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At 11:13 p.m. EST (0413 GMT) S&P 500 e-minis were down 97.5 points, or 4.57 percent, with 1,086,214 contracts changing hands. Nasdaq 100 e-minis were down 217.25 points, or 4.52 percent, in volume of 144,332 contracts, and Dow e-minis were down 684 points, or 3.74 percent, with 188,215 contracts changing hands.

“Nobody had hedged for a Trump win so people are trying to get out as quickly as possible now,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. “A lot of people are making big assumptions now based on the early returns. In my mind its preliminary.”

CBOE Volatility index futures shot nearly 40 percent higher, reflecting investors’ reservations over a Trump presidency.

The Mexican peso slumped versus the U.S. dollar to a historic low above 20 per dollar. The peso was last down more than 10 percent against the greenback.

“Big surprise, clearly going into the evening the polls were within the margin of error in most cases, but at the same time the general expectation was not that Trump would be victorious,” said David Joy, chief market strategist at Ameriprise Financial in Boston.

“There are still votes to count, but the way the night is unfolding is a surprise so far, and you are seeing that reflected in these asset prices.”

-the-star.co.ke

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1 COMMENT

  1. Don’t worry, Kenyans and other members of the African Diaspora. There is never going to be a wall of any kind except the invisible kind, which is nothing to be afraid of since it will not be there because fear is sometimes worse than reality; and there are never going to be mass deportations, except for real troublemakers who show signs they hate the US of A and prefer chaos or anarchy to freedom and opportunity. The rest of the rhetoric was smoke and mirrors for entertainment or shock value on both sides. So,enjoy pragmatism but pray for prudence and especially pray for prudent foreign policy advisors who will keep this non-politico President (and the US of Amazement out of trouble in dealing with the rest of the world). Entrepreneurship will hopefully thrive and stock investors and hedgers will have to wait to see what small business come-backs will do. And since most African Diasporans I know are amazing entrepreneurs with great ideas and know-how, there is no need to fret, but do prepare for opportunities to open up and don’t believe any of the hype and gripes of whiners or naysayers who want to keep people divided.

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