Global markets start to recover after Donald Trump victory

Global stock markets have started to recover after being roiled by news of D onald Trump’s surprise presidential victory.
London’s FTSE 100 Index was down by 0.5% at 6810.5 points, but had pared back losses after falling as much as 2% soon after opening. Donald Trump victory
European stocks were also trading lower, but likewise narrowed initial hefty falls, with the French Cac 40 and the German Dax down 1.3% and 1.2% respectively. Meanwhile, dollar weakness pushed sterling 0.5% higher to 1.244 dollars, as investors pulled away from the US currency. Connor Campbell, a financial analyst at Spreadex, said Mr Trump’s post-election address appeared to have calmed markets. He said: “A surprisingly ‘presidential’ Trump victory speech – setting the bar incredibly low for what is expected from a recently-elected candidate – seems to have reassured investors, the talk of infrastructure spending and a lack of usual vulgarity allowing for a relative aura of calm to encroach on the market.” US stocks are still set to suffer when trading on Wall Street kicks off at 2.30pm UK time, with Dow Industrial Average futures still indicating a 350 point fall. It follows a brutal trading day in Asia, where Japan’s Nikkei 225 index closed lower by more than 5.3% and Hong Kong’s Hang Seng Index dropped 2.2%. Investors flocked towards safe-haven assets such as gold, which rose more than 2.6% to around 1306.96 US dollars an ounce. The move has boosted mining shares in London , with precious metals firm Fresnillo jumping 9% to top the FTSE 100. Randgold Resources rose nearly 7%, Polymetal International jumped around 6%, Antofagasta rose about 5%, and Rio Tinto was up nearly 2%. However, the biggest losers on the FTSE 100 were driven by earnings results, with Sainsbury’s slumping 5% after posting a 10% fall in half-year profits and warning of an even tougher second half amid surging costs. Burberry was down 1.8% after half-year profits slumped 24%, as the benefits of a post-Brexit collapse in sterling were offset by pain in its wholesale and licensing business. In oil markets, Brent crude prices see-sawed, rising by 0.4% to 46.00 US dollars per barrel after dipping to around 44.39 US dollars per barrel in overnight trading. Fears over Mr Trump’s approach to foreign policy sent the Mexican peso plunging by as much as 12% against the US dollar. The president-elect previously threatened to make Mexico pay for a wall on America’s southern border and has disparaged the North American Free Trade Agreement. News of Mr Trump’s victory also sent the Canadian dollar lower by around 1.1% against the greenback. Mr Campbell warned that markets would face further pain in the coming months. “Of course, just as Britain hasn’t yet Brexited, America hasn’t officially entered the era of Trump, suggesting that much of the trading that greeted the open was a gut-reaction rather than informed positioning, especially considering how thin on the ground the Republican’s actual policies are. “That does, however, leave plenty of room for volatility as 2016 begins to wrap up, let alone the months and (shudder) years of an actual Trump presidency.”-belfasttelegraph

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