Former US president and the Republican Party’s nominee Donald Trump has declared victory in the US presidential election race. Trump has already congratulated his supporters for the ‘unprecedented mandate’ and victory. And as results continue to pour in, global markets have reacted.
One of the most noticeable reactions came from the crypto industry. On Wednesday morning bitcoin values hit a record-high of more $75,000. Investors in digital assets were obviously celebrating. Trump has openly supported the crypto industry during his election campaign and has promised to turn the US into the “bitcoin superpower of the world.”
Not only that, Trump has openly supported the launch of his family’s own crypto venture, the so-called World Liberty Financial. He also promised to put an end to the way regulators have targeted the crypto industry.
These are still early hours and things could settle down and change over the next few days. But Kris Marszalek, chief executive of exchange Crypto.com. was quoted by the FT saying “The future of crypto has never looked brighter than today.”
Brian Armstrong, chief executive of crypto exchange Coinbase, was also quoted by the paper, saying: “Tonight the crypto voter has spoken decisively. Americans disproportionately care about crypto and want clear rules of the road for digital assets.”
Optimism on Wall Street
Investors on Wall Street were seemingly in good spirits as they prepared for a positive market reaction to the result. The price of the US dollar also surged higher than it has for two years, according to reports.
Wednesday’s open also saw futures on the S&P 500 index climbing 2.1% and the Nasdaq 100 up 1.7%, according to report. There was also a noticeable gain for companies with direct or indirect links to Trump.
Most noticeable among them was Tesla, whose shares went up by 13.3%. Its billionaire owner Elon Musk has been a strong supporter of the former president throughout the whole election campaign.
Musk took to his own platform, X, in the early hours of Wednesday and posted: “The people of America gave Donald Trump a clear mandate for change tonight’.” In a separate post he said: “America is a nation of builders. Soon you will be free to build.”
There was also a sharp rise in US government borrowing costs. According to reports: “Yields on 10-year Treasury bonds jumped to 4.47pc, breaking last week’s top of 4.39pc,” while “Two-year yields climbed to 4.31pc from 4.19pc.”
What about global markets?
There was a marked decline in Chinese markets. The ‘tariffs war’ with Beijing has long been a key part of Trump’s agenda, featuring strongly during his previous term at the While House and throughout this campaign for a second term.
According to reports, there was a 2.2% fall in Hong Kong’s Hang Seng index. The offshore renminbi and the onshore equivalent also fell by 1.1% and 0.8% respectively, the FT has reported.
Pointing to potential future tensions between Washington and Beijing over tariffs, Ray Attrill, global co-head of forex strategy at National Australia Bank in Sydney, told the FT as Trump closed in on victory: “Trump’s tariffs, if he wins and if he goes ahead, have the potential to cause a huge amount of pain.”
In London there was a 1.3% jump in the FTSE 100 index as investors prepared for a Trump return to the White House. Reports also suggested hotels giant IHG and the lender Barclays were among those who could potentially benefit from the US election result.
In Europe, the markets seemed to be gaining momentum on Wednesday morning with the pan-European Stoxx 600 “up 1.3% and regional bourses and sectors broadly rising. Media stocks added 2.6% while autos led losses, shedding 2%,” according to early reports on Wednesday.
Stop & Shop owner Ahold Delhaize reported an 8% jump in share values. Also, “Siemens Healthineers was up 8.8% early Wednesday morning, while Novo Nordisk rose 7.4%,” reports said.
The increase in the value of the US dollar also seems to have had an impact on the oil market, with prices falling to $74 a barrel, it is being reported. The fact that Trump has promised to boost oil production at home could be another factor behind the price fall.
Ken Peng, head of Asia investment strategy at Citi Wealth in Hong Kong, told Bloomberg: “A lot of this is based on investors’ view that Trump would cut taxes or at least keep tax rates low. Now that it’s likely to be looking like a red sweep, additional cuts are possible.
“Deregulation is another major positive for the economy and markets, particularly for the financial, energy, and tech sectors,” he added.
