US stocks soared yesterday as presidential candidate Hillary Clinton’s prospects got a boost a day ahead of the election, after the FBI said it would not press criminal charges related to her use of a private email server.
Global equity markets and the dollar also bounced, with the US currency rising to $1.10 against the euro.
The Euro Stoxx 600 index of European shares was trading 1.3 per cent higher, while in London the FTSE 100 gained 1.6 per cent.
Dublin
In Dublin the ISEQ index was almost 1.9 per cent higher, led by a jump of 5 per cent-plus in Ryanair shares, after its first-half results.
Wall Street closed lower for the ninth day in a row on Friday, its longest losing streak in more than 35 years and yesterday stocks racked up their biggest one-day percentage gain since March 1st.
However, following the FBI announcement, at least three polls yesterday showed Democrat nominee Clinton was in the lead over Republican Donald Trump, calming nerves about the economic uncertainties which a Trump presidency would bring.
“Investors are reacting this morning to moving the email controversy to the sidelines, but still looking at a race that is too close to call,” said Art Hogan, chief market strategist at Wunderlich Equity Capital Markets in New York. It’s a market that is going to scrape back some losses we’ve seen over the last nine days and shift into stall mode at some point in time.”
The Dow Jones industrial average rose 371.32 points, or 2.08 per cent, to 18,259.6 while the S&P 500 gained 46.3 points.
The tech stock-heavy Nasdaq index gained almost 2.5 per cent, as investors piled back into shares.
Investors have tended to see Clinton as a more status quo candidate and expect her victory to clear the path for a US interest rate hike next month. On the other hand, Trump’s stance on foreign policy, trade and immigration has unnerved the market.
‘Fear gauge’
The CBOE Volatility index, Wall Street’s so-called ‘fear gauge’, tumbled 17 per cent, its biggest one-day drop since June 28th, just after Britain voted to leave the European Union.
In general, riskier assets were back in favour, with Brent crude futures rising for the first time in seven days, also helped by Opec’s commitment to stick to a deal to cut output.
The dollar rose for the first time in five days, while safe-haven gold was set for its worst day in more than a month. – (Reuters)
