Markets react to Obama win

[CENWEN]

Markets react to Obama win

Asian stocks soared to a 3-week high as markets reacted to news of Barack Obama's win in the U.S presidential elections.

Shares gain as Obama wins U.S. presidency

<cite class="auth">Reuters - Wednesday, November 5

</cite>* Asian shares hit 3-week high as new U.S. president elected
* Dollar recovers after steep slide in prior session
* European shares set to open slightly lower
* Oil falls on profit-taking after previous day rally
By Rafael Nam

HONG KONG, Nov 5 - Asian shares hit a three-week high and the dollar extended gains as Barack Obama became the next U.S. president, ending uncertainty about who will lead the world's largest economy in the midst of great financial peril. But Asian stocks pared gains and European shares were set to open slightly lower, with analysts saying a victory for Obama had been largely priced in after recent rises and concerns about the health of the global economy still paramount. U.S. Treasuries fell as investors became bolder in taking risk, but oil succumbed to profit-taking after signs of global production cuts had sent crude prices up 10 percent on Tuesday. Gold fell more than 1 percent on the firmer dollar. The new Obama administration, which takes office in January, will face the world's worst financial crisis since the Great Depression, and a potentially steep slowdown in global growth that has pounded markets from Tokyo to Frankfurt to New York. "The market was putting in an Obama bounce earlier today, and we are seeing a continuation of that rally around the world," said Peter Kenny, managing director at Knight Equity Markets in New Jersey.

"Clearly the market was anticipating a fairly substantial referendum on change and an Obama presidency and a different path. The market called it and the market was right," he said. But some also urged caution despite unprecedented measures to rescue banks across the world, aggressive rate cuts by central banks, and the improvements in credit markets that have in the last week given global markets a respite from a thrashing. "The knee-jerk complacency rally in Asia to an Obama win is likely creating an opportunity to sell," said Kirby Daley, a senior strategist for Newedge Group in Hong Kong. "The bottom line is economic fundamentals in the U.S. are deteriorating faster than the market can keep up with. And there is very little an Obama administration can do to shield Asia from the effects of this downturn." The MSCI index of Asian stocks outside Japan <.MIAPJ0000PUS> rose for a seventh consecutive session on Wednesday, and was up 2.5 percent gain as of 0700 GMT, after earlier hitting the highest since Oct. 16.
The gains came after U.S. stocks on Tuesday enjoyed their biggest election day rally ever. Tokyo's Nikkei <.N225> rose 4.5 percent, led by exporters such as Honda Motor Co <7267.T> that were bolstered by a softer yen, while energy-linked firms such as Mitsubishi Corp <8058.T> gained on the overnight oil price rally. Markets in Hong Kong <.HSI>, Singapore <.FTSTI> and Shanghai <.SSEC> rose more than 3 percent, while stocks in Australia <.AXJO> and South Korea <.KS11> gained over 2 percent. But shares in Taiwan <.TWII> and India <.SSEC> declined.

DOLLAR ADVANCES
In a sign that investors may be more willing to add risk, U.S. Treasury prices fell after Obama's win. The 2-year note's price traded down 3/32 <us2yt=rr> for a yield of 1.44 percent. The dollar advanced following Obama's election, recovering some of the prior day's losses that saw the currency suffer its biggest one-day slide in 13 years as investors went searching for higher yielding currencies. " is arguably likely to prove more positive for foreign markets given the perception that he will be stronger in terms of dealing with U.S. economic problems, is seen more favourably by foreigners generally, and is less likely to follow the policies of President Bush," Calyon said in a report. The dollar rose 0.8 percent against a basket of major currencies to 85.268 <.DXY> after falling around 2.5 percent on Tuesday for its biggest one-day drop in 13 years. The euro slid 1.0 percent to $1.2855 <eur=> on trading platform EBS. The dollar dipped 0.2 percent against the yen to 99.50 yen <jpy=>. Traders said dollar selling by Japanese exporters and profit-taking supported the yen. Oil <clc1> remained lower after the U.S. presidential election, with crude down $1.50 to $69.05 a barrel as investors took profits after a spike on Tuesday following signs that Saudi Arabia and other OPEC members had made promised cuts in crude production. Other commodities also fell. Gold <xau=> was trading at $750.75 an ounce, down $11.20 from its notional New York close on Tuesday when it had rallied around 5 percent on the back of a dollar slide.</xau=></clc1></jpy=></eur=></us2yt=rr>

 

[CENWEN]

Stocks, dollar rise as Obama takes White House

<cite class="auth">AFP - Wednesday, November 5

</cite>TOKYO (AFP) - - Asian stocks and the dollar climbed Wednesday as Democrat Barack Obama was elected US president, raising hopes of fresh action to revive the economy amid the worst financial crisis in decades.

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</noscript>"Markets generally favour a Republican government," said Kazuhiro Takahashi, general manager at Daiwa Securities SMBC. "But this belief has collapsed amid the financial crisis." Hong Kong shares jumped 5.7 percent by midday while Japan's Nikkei stock index was up 2.5 percent in the afternoon. Stocks rose 4.4 percent in Singapore and 2.7 percent in Sydney. "We're seeing the Obama rally," Patrick Crabb, senior sales trader at Goldman Sachs JB Were in Melbourne, told Dow Jones Newswires. The euro fell to 1.2868 dollars in early afternoon trade in Tokyo, compared with 1.2942 in the morning before television networks projected Obama's victory . Obama is expected to "bring change to the country amid an unprecedented crisis," said Saburo Matsumoto, chief forex strategist at Sumitomo Trust Bank. "Even if economic figures and sentiment remain grim, markets still have high expectations for the policies that he will iron out from January," he added. Obama, 47, will be inaugurated as the 44th US president on January 20 and inherit an economy mired in the worst financial crisis since the 1930s. Dealers had said before the vote that a decisive win by either Obama or his Republican rival John McCain would clear up uncertainty about the leadership of the economy and the handling of the financial crisis. McCain conceded defeat Tuesday, calling for Americans to unite behind their new leader.

The Dow Jones Industrial Average added 3.28 percent and the Standard & Poor's 500 index gained 4.08 percent on Tuesday as Americans went to the polls. Investors were also anticipating further interest rate cuts by world central banks to try to thaw frozen credit markets and ward off a global recession. The European Central Bank and the Bank of England are both widely expected to make cuts when they hold separate meetings on Thursday. "Signs the worldwide measures taken to shore up the banking sector are easing the pressures in global cash and credit markets has also helped underpin investor confidence," said NAB Capital analyst John Kyriakopoulos. But while the credit crunch is showing signs of easing, worries are growing about the prospect of a global economic downturn. In Australia , the government warned the global financial crisis would cut the nation's economic growth, slash billions of dollars off the forecast budget surplus and increase unemployment. The Australian economy is expected to grow 2.0 percent this financial year, down from 2.75 percent previously projected, the government said, a day after the central bank there slashed its key interest rate by 75 basis points. "While Australia is clearly not immune from the effects of the global financial crisis and the global downturn, we are better placed than most other countries to withstand the fallout," said Treasurer Wayne Swan.

 

[po2wq]

down liao ler ... kena sabo liao ...

 

[tun_dr_m]

But sorry it didn't hold up at all!

It fell 350 down in very same day, bad omen for Obama.

http://finance.yahoo.com/

http://us.rd.yahoo.com/finance/news...tp://biz.yahoo.com/ap/081105/wall_street.html

AP
Stocks fall as investors ponder Obama presidency
Wednesday November 5, 2:28 pm ET
By Sara Lepro, AP Business Writer
Wall Street falls sharply as investors ponder impact of Obama presidency on business, economy

NEW YORK (AP) -- A case of postelection nerves sent stocks plunging Wednesday as investors again anxious about recession began questioning what impact a Barack Obama presidency will have on business and the overall economy. The Dow Jones industrials dropped more than 350 points and the major indexes all fell more than 3 percent.

ADVERTISEMENT
Stocks fell initially as investors cashed in gains after a six-day run that lifted the Standard & Poor's 500 index more than 18 percent. But the selling picked up momentum as the market worried anew about the weakness of the economy and pondered what an Obama administration might do.

Obama will inherit an enormous budget deficit when he is sworn in Jan. 20. Analysts said they the market is already growing anxious about who Obama selects as the next Treasury Secretary, as well as who he picks for other Cabinet positions.

"A lot of the policy going forward is going to have an effect on the various sectors of the market," said Joe Keetle, senior wealth manager for Dawson Wealth Management.

Obama's victory means that industries such as oil and gas producers, utilities and pharmaceuticals may face greater regulation and even taxes, while labor unions and automakers are expected to benefit.

In addition, banks, insurance companies, hedge funds and the rest of the financial sector will almost certainly face attempts at a regulatory overhaul by the Democratic Congress next year.

The economy, and how long and deep the current downturn will be, weighed heavily on the market Wednesday.

"I think what is happening in the market is a continuation of really the last few weeks," said Subodh Kumar, global investment strategist at Subodh Kumar & Associates in Toronto. "The markets are still incorporating the slowdown in the global economy."

"I would put what we're seeing today not so much as disappointment about policy from the incoming administration and more about continuing to incorporate assessments about how weak economies are," he said.

Analysts said investors were growing uneasy in advance of the Labor Department's October employment report, to be issued on Friday. Economists on average expect a 200,000 drop in payrolls, according to Thomson/IFR. Employers have been slashing jobs after a freeze-up in the credit markets crippled many companies' ability to get financing.

The market showed no initial reaction to the release of the Institute for Supply Management's services sector index, which fell to 44.4 in October from 50.2 in September. But the decline, a steeper drop than the market expected, did add to the overall gloom on the Street.

In mid-afternoon trading, the Dow fell 351.09, or 3.65 percent, to 9,274.19.

The S&P 500 index fell 37.12, or 3.69 percent, to 968.63. Through the six sessions that ended Tuesday, the index, the one most closely watched by market professionals, rose 18.3 percent.

The Nasdaq composite index fell 70.01, or 3.93 percent, to 1,710.11, while the Russell 2000 index of smaller companies fell 19.67, or 3.60 percent, to 526.30.

Declining issues outnumbered advancers by about 3 to 1 on the New York Stock Exchange, where volume came to a light 674.01 million shares.

Wednesday's trading, which followed a 300-point jump in the Dow on Tuesday, showed that the market is living up to expectations of continued volatility as it tries to recover from the devastating losses of the last two months.

Bill Stone, chief investment strategist at PNC Wealth Management said the uncertainty over the direction the government's financial bailout plan will take under the next administration likely weighed on financial stocks Wednesday.

Analysts agree that Obama's most immediate priority will be dealing with the nation's financial crisis and deciding how to further implement the $700 billion rescue package passed by Congress last month. He is expected to move quickly to get a team in place to work with outgoing Treasury Secretary Henry Paulson.

"You've got to believe that the Obama camp knows you have to have a smooth transition," Stone said.

Bank of America Corp. shares dropped $1.53, or 6.2 percent, to $23. Citigroup Inc. fell $1.28, or 8.7 percent, to $13.40. Morgan Stanley, meanwhile, tumbled $1.02, or 5.4 percent, to $17.88.

In addition to monitoring the direction the next administration will take, investors continue to heed the state of the credit markets. The paralysis in the credit markets that began after the bankruptcy of Lehman Brothers Holdings Inc. in mid-September has been alleviated somewhat by a series of government interventions, but they still show some signs of strain.

"The credit markets are starting to show some improvement and I think that has to continue for all the markets to do well," Keetle said.

Banks continued to ratchet down the rates they charge one another for borrowing on Wednesday, but the key interbank lending rate -- the London Interbank Offered Rate, or Libor -- remains well above the Federal Reserve's target interest rate of 1.00 percent. Libor for three-month dollar loans fell to 2.51 percent from 2.71 percent Tuesday.

And the bid for Treasury bills remains high. The three-month bill, considered one of the safest assets around, fell to 0.41 percent from 0.48 percent late Tuesday. A low yield indicates high demand.

The yield on the benchmark 10-year Treasury note fell slightly to 3.72 percent from 3.73 percent late Tuesday.

The dollar was mixed against other major currencies. Gold prices fell.

Other sectors that are being closely watched in light of the election results are pharmaceuticals and alternative energy, analysts said.

Merck & Co. Inc. shares fell $1.88, or 6 percent, to $29.25. Pfizer Inc., meanwhile, dipped 75 cents, or 4.2 percent, to $17.34. SunTech Power Holdings Co. was among the alternative energy stocks that declined, falling $3.07, or 15 percent, to $17.16.

Light, sweet crude dropped $4.88 to $65.65 a barrel on the New York Mercantile Exchange.

In Asian trading, Japan's Nikkei index rose 4.46 percent, and Hong Kong's Hang Seng Index rose 3.17 percent. Britain's FTSE 100 fell 2.34 percent, Germany's DAX index fell 2.11 percent, and France's CAC-40 fell 1.98 percent.

New York Stock Exchange: http://www.nyse.com

Nasdaq Stock Market: http://www.nasdaq.com

 

[tonychat]

Obama is a good thing for the US.

 

[imperialarms]

oh dow lao sai 500 pts