World stock markets sank Wednesday after maverick Republican Donald Trump surprisingly won the US election, triggering chronic uncertainty that sent investors fleeing for safe-haven assets, dealers said.
Asia kicked off the so-called “Trump slump”, with Tokyo diving on concerns over the untested policies of the billionaire businessman and reality TV star, who has scored a surprise victory over Democrat market favourite Hillary Clinton.
Europe followed suit, tipping about two per cent lower at the open in Frankfurt, London and Paris, but the British market rebounded briefly into slender gains after Trump’s conciliatory victory speech.
“This is a shock result. Twelve hours ago, people thought Clinton would win,” City Index analyst Kathleen Brooks told AFP.
“Now the US has a commander-in-chief who has no political experience. This is the ultimate uncertainty — triggering a Trump slump.
“Markets are pricing in the worst possible case scenario. If he is not as bad as people think he is, then markets could recover soon.”Trump, 70, will now become the 45th president of the United States at his inauguration on January 20.
“After that initial plunge, European markets have seen a remarkable recovery this post-election Wednesday,” added Spreadex analyst Connor Campbell.
“A surprisingly presidential Trump victory speech seems to have reassured investors, the talk of infrastructure spending and a lack of usual vulgarity allowing for a relative aura of calm.”
