Asian markets rattled by Trump election lead
ASIAN equities tumbled yesterday, extending a global sell-off, and the Mexican peso fell after a poll showed Donald Trump overtaking market favourite Hillary Clinton in the race for the White House.
With Ms Clinton until last week comfortably ahead, traders were upbeat about her chances of winning on November 8 but news that the FBI was again looking at her emails has raised the prospect of Mr Trump becoming president.
“Since the FBI reopened its case into Hillary Clinton’s emails last Friday, her substantial lead in the polls has been decimated and some now even show Trump in the lead,” Craig Erlam, a senior market analyst at OANDA, said in a note.
“It’s been clear that markets would much prefer the stability that a Clinton victory would bring for the US economy and the reaction since the polls started to change so dramatically just confirms this.”
The Wall Street losses filtered through to Asia, where Tokyo closed 1.8 percent lower, while Hong Kong dived 1.5pc and Shanghai ended down 0.6pc.
Sydney and Seoul each sank more than 1pc and there were also sharp losses in Wellington, Manila and Taipei.
Currency traders also took fright, fleeing into the safe-haven yen. The greenback fell to 103.73 yen in Tokyo, down from 104.12 yen in New York and well off the levels of above 105 yen seen the day before.
Analysts say a Trump win could also lead the Federal Reserve to put off an expected December interest rate hike owing to worries about his effect on the economy.
The greenback however rallied against higher-yielding, riskier Asia-Pacific units, soaring 0.9pc against the South Korean won and 0.5pc versus the Australian dollar.
A week-long retreat in oil prices also extended in Asia, with both contracts down almost a tenth from recent highs as investors grow worried about the chances of success for OPEC’s September agreement to cut output. –