Global markets rally on Trump’s victory
Wall Street marched to record highs on Wednesday and major stock markets around the world surged, while bitcoin also hit an all-time-high and the dollar was set for its biggest one-day jump in four years after Donald Trump was elected US President.
Trump's pledges to raise tariffs, cut taxes and slash regulations encouraged investors to dive into a range of assets that looked likely to benefit from such policies.
The VIX, a measure of volatility also perceived as "Wall Street's fear gauge," dived 19 per cent as investors scooped up risky assets across the board.
Small cap US stocks in particular were boosted by expectations that a Trump presidency would offer tax cuts and support domestic companies.
The dollar index rallied 1.6 per cent and was set for its best day since September 2022. European shares gave up earlier gains and fell 0.5 per cent.
Markets that could suffer under tougher tariffs, including those in some of major US trading partners, bore the brunt of the sell-off. The Mexican Peso slumped to its lowest in over two years while the Euro was set for its largest daily drop since 2020.
Meanwhile, Indian stock markets rallied more than 1 per cent on Wednesday with benchmark Sensex soaring 901 points on heavy buying in IT and pharma shares amid Donald Trump’s victory in the US presidential polls. Extending its gains to the second day, the BSE Sensex jumped 901.50 points or 1.13 per cent to settle at 80,378.13. During the day, it soared 1,093.1 points or 1.37 per cent to 80,569.73.
The NSE Nifty soared 270.75 points or 1.12 per cent to close at 24,484.05.
From the 30-share Sensex pack, Tata Consultancy Services and Infosys jumped over 4 per cent each.
"Global markets experienced a relief rally following the US election results, reducing political uncertainty with Trump securing a strong mandate. This has led to strong risk-on sentiments, driven by expectations of tax cuts and increased government spending," Vinod Nair, Head of Research at Geojit Financial Services said.
All sectoral indices ended higher. Meanwhile, the rupee depreciated 22 paise to close at an all-time low of 84.31 against the US Dollar on Wednesday.
Tesla shares soar
- New York: Elon Musk’s Tesla, banks and bitcoin stormed higher as investors bet on what Donald Trump’s return to the White House would mean for the economy and world
- Among the losers the market sees: the Mexican peso, renewable energy companies and potentially anyone worried about higher inflation.
- The Dow Jones Industrial Average jumped 1,200 points, or 2.8% early Wednesday. The S&P 500 rose 2%, and the Nasdaq composite rose 1.9%. Investors expect Trump’s victory to lead to faster economic growth and more market-friendly policies. Trump Media & Technology Group, the company behind the Truth Social platform, soared.
