Posted: Monday, November 14, 2016 – 3:24 PM
(AFP) The Dow and European stocks got another boost Monday and the dollar surged higher as Donald Trump’s shock win of the US presidential election last week continued to buoy markets.
As specifics about Trump’s policies and staffing picks began to drip out, markets took solace that he might not be as extreme as he sounded during the hard-fought election race, said analysts.
During the day the dollar struck an 11-month high against the euro at $1.0709, and reached a five-month peak against the yen.
On Wall Street, the Dow Jones Industrial Average hit an all-time intraday record early in trade at 18,934.05, then retreated but still managed to close higher for a sixth straight day, up 0.1 percent.
The broader S&P 500 slipped less than 0.1 percent while the tech-heavy Nasdaq fell 0.4 percent.
London’s benchmark FTSE 100 closed 0.3 percent higher, with Frankfurt’s DAX 30 adding 0.2 percent and the Paris CAC 40 climbing 0.4 percent.
“It appears that the fact that President-elect Trump might not be quite as radical and confrontational as some had feared … is pushing stocks higher for now,” said Markus Huber, a trader at City of London Markets.
Equities around the world have been volatile amid worries that Trump’s pledge of big-spending measures and tax cuts could lead to a surge in inflation and higher borrowing costs.
“Trump-watching is still the pastime of choice,” said analyst Jasper Lawler at CMC Markets.
The prospect of better and safer returns in the US has also led to an exodus from emerging markets and currencies, while the Mexican peso has hit record dollar-lows owing to concerns about Trump’s warning he will tear up a key trade deal.
“It is not so much that is euro is weak. It’s the dollar that is strong,” said Vassili Serebriakov of Credit Agricole.
“In terms of the drivers, it is a continuation of the post election move. There is increased focus of fiscal policy in the US and the potential for large fiscal stimulus. So that is driving interest rates higher in the US and helping the dollar.”
– Banking shares jump -Bank shares have been big gainers as lenders stand to benefit from lighter regulation.
In New York, JP Morgan Chase gained 3.7 percent, Goldman Sachs rose 2.6 percent and Morgan Stanley finished up 2.2 percent.
Meanwhile, in London, Barclays jumped 5.4 percent and RBS 4.5 percent, while UBS climbed 5.5 percent in Zurich, and Commerzbank soared 6.6 and Deutsche Bank added 3.8 percent in Frankfurt.
Tokyo’s Nikkei ended up 1.7 percent, with exporters rallying on the back of the weakened yen. The dollar reached 107.96 yen, the highest mark since early June.
Shanghai gained 0.5 percent, but Hong Kong sank 1.4 percent.
Oil prices remained under pressure after OPEC said last week it pumped a record amount of crude in October, while traders were worried the producers’ cartel will not be able to implement an earlier agreement to cut output.
- Key figures around 2100 GMT -New York – Dow: UP 0.1 percent at 18,868.55 (close)
New York – S&P 500: FLAT at 2,164.21 (close)
New York – Nasdaq: DOWN 0.4 percent at 5,218.40 (close)
London – FTSE 100: UP 0.3 percent at 6,753.18 (close)
Frankfurt – DAX 30: UP 0.2 percent at 10,693.69 (close)
Paris – CAC 40: UP 0.4 percent at 4,508.55 (close)
EURO STOXX 50: UP 0.3 percent at 3039.80 (close)
Tokyo – Nikkei 225: UP 1.7 percent at 17,672.62 (close)
Hong Kong – Hang Seng: DOWN 1.4 percent at 22,222.22 (close)
Shanghai – Composite: UP 0.5 percent at 3,210.37 (close)
Euro/dollar: DOWN to $1.0738 from $1.0859 Friday
Dollar/yen: UP at 108.48 yen from 106.67 yen
Pound/dollar: DOWN to $1.2497 from $1.2605
Oil – West Texas Intermediate: DOWN 9 cents at $43.32 per barrel
Oil – Brent North Sea: DOWN 32 cents at $44.43 per barrel
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