US stock futures and the dollar rose in Asia on Wednesday as early presidential election results showed a tight race, leaving investors uncertain.
US stock futures and the dollar climbed in Asia on Wednesday as early results from the presidential election suggested the race remained too close to call, leaving investors jumping at shadows.
Some funds are going long currency options that would benefit from a weaker dollar if Kamala Harris wins and reduced some dollar-bullish positions on Monday. The one-week euro/dollar implied volatility just hit its highest since March 2023. According to Citigroup strategists, a Trump win would see a 3% dollar rally and a Harris win would see the dollar down 2%.
Markets generally think Trump’s immigration restrictions, tax cuts and tariffs would put more pressure on inflation and bond yields than Harris’ center-left stance. Wall Street was up big on Tuesday after ISM non-manufacturing PMI rose to 56, highest since August 2022, meaning the economy is resilient.
And the congressional elections are on the radar too, where a divided government is expected. That would limit the president’s ability to do big things.
The S&P 500 sits comfortably above 50 SMA, suggesting the strong upside bias. It was near the historic high around 5,880 which appears to be the immediate resistance.
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