Asian mar­kets rally on FBI an­nounce­ment

The Myanmar Times - - International Business -

ASIAN equities staged a re­bound and the Mex­i­can peso ral­lied yes­ter­day as traders breathed a sigh of re­lief af­ter the FBI chief said mar­ket favourite Hillary Clin­ton would not face charges over her use of a pri­vate email server.

In­vestors were sent into a funk last week af­ter James Comey said mes­sages linked to the Demo­cratic pres­i­den­tial nom­i­nee were be­ing in­ves­ti­gated, send­ing ri­val Don­ald Trump surg­ing in opin­ion polls just days be­fore to­day’s vote.

The former sec­re­tary of state is con­sid­ered by most in­vestors to be a safer bet than Mr Trump, who is seen as a loose can­non with poli­cies many fear could wreck the world’s top econ­omy.

How­ever, Mr Comey on Novem­ber 6 an­nounced he would not change his July rec­om­men­da­tion that Ms Clin­ton not be pros­e­cuted for putting US se­crets at risk.

“Mar­kets are likely to re­move some of the risk pre­mium taken as a pre­cau­tion against a Trump vic­tory now that Hillary Clin­ton will not be charged over her use of a pri­vate email server,” said CMC Mar­kets chief an­a­lyst Ric Spooner.

“How­ever, an el­e­ment of un­cer­tainty re­mains over this elec­tion. It seems un­likely that mar­kets will make a full ‘risk on’ move un­til Clin­ton is de­clared the win­ner.”

Tokyo’s Nikkei ended 1.6 per­cent higher while Hong Kong closed up 0.7pc, with bank­ing gi­ant HSBC more than 2pc higher af­ter it re­ported a fore­cast-beat­ing rise in pre-tax profit.

Shang­hai closed up 0.3pc, Syd­ney added 1.4pc and Seoul gained 0.8pc, while Welling­ton soared 2.4pc and Sin­ga­pore put on 0.5pc.

The news also pro­vided strong sup­port for the Mex­i­can peso, which soared more than 2pc against the dol­lar yes­ter­day, hav­ing been bat­tered last week.

The peso is con­sid­ered a proxy for Mr Trump’s chances be­cause of his anti-Mex­i­can rhetoric through­out the cam­paign – in­clud­ing his pledge to re­move un­doc­u­mented mi­grants, build a bor­der wall and tear up a trade deal.

Also help­ing stocks was a solid US Oc­to­ber jobs report which gave the Fed­eral Re­serve fresh am­mu­ni­tion to raise rates in De­cem­ber, while the bank’s vice chair Stan­ley Fis­cher said the labour mar­ket was in a “pow­er­ful” re­cov­ery and in­fla­tion was pick­ing up.

The dol­lar ral­lied on the FBI news, break­ing back above 104 yen while also tick­ing back up against the pound.

Ster­ling surged last week af­ter the Lon­don court rul­ing that the Bri­tish govern­ment would need par­lia­men­tary ap­proval to of­fi­cially move to pull out of the Euro­pean Union. –

Photo: AFP

James Comey says Hillary Clin­ton will not face charges.

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