See How Markets Around the World Reacted to a Trump Victory

It may have been suggested a Donald Trump victory could lead to recession, then eventual doom for all of humanity – but now the markets have an idea of what they’re in for, they’re actually pretty cheerful.

Around 1030 GMT, London’s benchmark FTSE 100 index was up 0.9 percent compared with the close on Wednesday.

Global stock markets were steady Tuesday, Nov. 8, 2016, following strong Wall Street gains the day before, as investors focused on the final hours of a tight USA presidential race.

The World market became expectedly volatile on the night of the results as the victory of the Republican candidate became evident.

In Europe, the pan-European Stoxx-600 index was around 1.09 percent higher on Thursday morning. Mexico’s peso tumbled the most since 2008 amid concern United States trade policies will become more protectionist under Trump.

He said the shock of the outcome “makes Brexit look like a picnic” and predicted the reverberations of Trump’s election could bring the onset of recession in 2017.

However, neither markets nor currencies have swung as wildly as they did after June’s European Union referendum. The peso fell as much as 13 percent against the US dollar and traded through the psychological barrier of 20.00.

Investors chose to focus on his campaign promises aimed at boosting USA economic growth through higher infrastructure spending and cutting red tape, rather than uncertainties such as what he might do with trade agreements.

Japan’s Nikkei index fell almost 400 points, and Hong Kong’s Hang Seng index dropped more than 800 points as election results were being tallied, leading the decline in the the US markets.

In the end, the indicators were wrong.

Those concerns weighed heavily on Asian stocks.

Why are traders so sanguine? Once bitten, twice shy. Banks and other financial stocks tend to benefit from higher interest rates and less government regulation, two things investors anticipate could happen during a Trump presidency.

Financiers are set aside for the moment longer-term worries about whether he will slap punitive tariffs on Chinese and Mexican exports, risking a global trade war.

But then on Wednesday morning, US investors reassessed – and calmed down.

The upcoming Trump presidency, which will commence on January 20, will likely remain a key driver in markets for the rest of the year. Whether for better or for worse remains to be seen.

Several analysts warned that markets could see volatility ahead as Trump’s administration begin to takes form and eventually take office.

Looking at USA markets this morning, you wouldn’t know that America had just elected a man without any experience in public office or the military, who voters were told over and over again was supremely unqualified to be president.

“Hillary Clinton had been very vocal in her opposition to drug price gouging”.

On the currency markets, the pound climbed 0.8% against the United States dollar at 1.248 and 1.6% against the euro at 1.140.

Haven currency the yen was a big loser Thursday, slumping to a 3.5-month low at 106.43 yen to the dollar.

Market strategists said the lack of a panic is due in part to hope that Trump will focus on policies that can help the economy, instead of more disruptive ideas like scrapping NAFTA.

“Anything that Trump mentioned during the campaign, any industry he has mentioned, favourably or unfavourably, is moving today big-time”, said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.

This post was syndicated from The Nation Nigeria.