Markets digest Trump's shocking victory

Yesterday’s markets

10th November 2016

  • EUR EU Economic Forecasts
  • USD Crude Oil Inventories: 2.4M
  • NZD Official Cash Rate: 1.75%
  • GBP MPC MPC Member Haldane Speaks
  • GBP Goods Trade Balance: 12.7B
  • NZD RBNZ Press Conference

Markets continued to digest Trump's shocking victory. Market reaction in the emerging currencies specifically was chaotic. The MXN peso depreciated 10%, the S&P 500 futures fell 3%, while safe havens like gold and treasuries were on the rise. The Japanese Yen and Euro are also rallied well after a surge to safe haven currencies. In terms of GBPUSD, it remained relatively stable, with some signs of strength amid funding currency demand. However, Trumps victory speech help calm markets and as the US opened the stock markets regained the initial losses leading into Trumps electoral victory, and likewise where gold gained around 3%, it traded back down to pre Trump election.  An emotional Clinton urged her supporters to show respect to her rival and that the transition of power to the new president must be respected.

Today’s markets

9th November 2016

  • CAD NHPI m/m
  • USD Unemployment Claims
  • USD FOMC Member Bullard Speaks
  • RBA RBA Assist Gov Debelle Speaks
  • EUR Italian Industrial Production m/m

Yesterday the anti-establishment sentiment that seems to be the trend of late continued. This trend is where protest votes are taking place with prime examples being the Brexit vote and now Donald Trump being elected as the new US president against prediction. The focus now seems to be on the Euro where the single currency was being sold off and lost ground across the board. With elections next year in Germany and France markets are already looking to see if the voters will again side against the establishment. As Italian Prime Minister holds a political referendum for reform in early December, worries are already showing true to protest votes, as government bonds slumped after Trumps victory. 

Another key piece of labour data released from the US this week. Last week’s non farms and unemployment rate posted healthy numbers, with unemployment falling to 4.9%. Can the jobless claims figure follow suit and help fuel the fire for a Fed rate rise next month?