By Nichola Saminather
SINGAPORE Asian shares rose in early Asian trade on Tuesday ahead of the U.S. presidential election, with investor sentiment buoyed by improving prospects for Democrat Hillary Clinton to win. The Mexican peso, which has moved in opposite step to perceived chances of Republican Donald Trump winning the election, retained its strong gains from Monday, while the dollar also held steady. Boosting Clinton's chances of winning, and markets globally, was the FBI's statement on Sunday standing by its July finding that Clinton was not guilty of criminal wrongdoing in her use of a private email server. That came after the Bureau announced on Oct. 28 it was reviewing additional emails relating to the server while Clinton was secretary of state, sending markets around the world tumbling.Clinton is seen by investors as offering greater certainty and stability, and, until last week's stumble, had been seen as the likely victor in Tuesday's presidential vote. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up 0.2 percent. Japan's Nikkei .N225 rose 0.3 percent, aided both by the positive sentiment and a weaker yen.
The MSCI World index .MIWD00000PUS added 0.1 percent, building on Monday's 1.6 percent surge, its biggest single-day jump in almost 19 weeks."As markets head into the U.S. election, a final recalibration of risk is in train," Michael McCarthy, chief market strategist at CMC Markets in Sydney, wrote in a note. "Asia-Pacific markets were the first to adjust to the political shift, and may trade more modestly today after roaring back to life yesterday."Overnight, Wall Street shares soared between 2.1 and 2.4 percent, recording their biggest one-day percentage gain since March 1, with the S&P 500 and the Dow Jones Industrial Average recovering all their losses from the previous week. While polls last week showed Trump closing in on Clinton's lead, at least five major polls on Monday showed Clinton still ahead.
The dollar JPY=D4, which recorded its biggest one-day increase against the yen in almost four months on Monday, extended that gain to climb 0.1 percent to 104.43 yen on Tuesday. The U.S. currency was little changed versus the Mexican peso MXN=D2 at 18.5665, after dropping 2.3 percent on Monday, its biggest one-day drop in six weeks. The Mexican currency is seen as a proxy for bets on the U.S. election because Mexico is considered most vulnerable to Trump's trade policies as 80 percent of its exports go to the United States.
The euro EUR=EBS was steady at $1.10425 on Tuesday, after sliding 0.9 percent on Monday. Crude oil futures, which rose on the revival of risk appetite on Monday, retained their gains. U.S. crude CLc1 was flat at $44.87 a barrel, after advancing 1.9 percent on Monday, but concerns about the stronger dollar and doubts over OPEC's planned production cuts still weighed on sentiment. Gold XAU=, which plunged 1.7 percent as demand for the safe haven ebbed, was flat at $1,281.65 an ounce early on Tuesday. (Reporting by Nichola Saminather; Editing by Eric Meijer)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Updated Date: Nov 08, 2016 07:00 AM