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U.S. equity futures soared in overnight trading, while the dollar scaled to a fresh four-month high on foreign exchange markets and Treasury bonds tumbled, as former President Donald Trump looked almost certain to capture figure in the 2024 election and return the the White House with a Republican-controlled Congress.
Trump, 78, declared victory at around 2:30 am Eastern time after the Associated Press called the state of Pennsylvania in his favor, putting him just shy of the 270 seat Electoral College threshold that would sweep him into the White House. He is also on track to possibly win the popular vote.
Projections also suggest that Republican lawmakers would re-take control of both the House of Representatives and the Senate, setting up a so-called ‘red wave’ that would allow his economic agenda to move quickly to fruition when he assumes office in late January as the 47th President.
“America have given us an unprecedented and powerful mandate,” Trump told his supporters. “This was the greatest political movement of all time.”
Markets around the world are reacting to what appears to be a decisive win for former President Donald Trump, and the broader Republican party, in the 2024 elections.
Stock futures reacted to the seemingly decisive win, particularly given the nature of House and Senate races, while markets around the world braced for the impact of Trump’s promised tariff and trade protection policies under a new administration.
Starmer congratulates Trump pic.twitter.com/NGyOaVHF9b
— Olly Barratt (@ollybarratt) November 6, 2024
The S&P 500 looks set to open at a fresh all-time high, with futures contracts tied to the benchmark indicating an opening bell gain of around 112 points.
The Dow Jones Industrial Average, meanwhile, was last called more than 950 points higher, a move that would put it over the 43,000 point mark.
The tech-focused Nasdaq, meanwhile, was marked 332 points higher as traders bet that fewer regulatory hurdles would stand in the way of the megacap tech growth story.
Treasury bond yields, however, were also moving sharply higher, with benchmark 10-year note yields rising to 4.471% and 2-year paper trading at 4.241%.
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“Market reaction is large but orderly- we have to remember that markets have been putting on the Trump 2.0 trade directionally since early October,” said John Hardy, chief macro strategist at Saxo Bank. “So the coming hours and days will tell is the degree to which we have priced in a lot of what is to come if the scenario is fully realized.”
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 1.55% higher at 105.023, the highest since early July.
Bitcoin prices, meanwhile, surging past the $75,000 mark for the first time on record, as investors bet that a Trump administration would bring through favorable regulation for the cryptocurrency sector.
The world’s biggest digital currency was last marked 5.1% higher at $72,922.94 each.
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Currencies seen as being exposed to Trump’s planned tariffs were also on the move, with the euro falling 1.4% to 1.0736 against the greenback and the Mexican peso falling to the lowest levels in more than two years at 20.635 against the dollar.
European politicians will be waking up to face their fears this Wednesday morning,” said ING’s global head of markets Chris Turner. “As it now seems likely now that Trump will take the presidency with a strong popular mandate, his trade agenda of levelling the playing field will weigh heavily on the open economy of continental Europe.”
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