Global Stocks Drop on US Election Jitters and Oil Fall

Global equity prices and the dollar slid for the second straight day on Wednesday, while safe-haven assets such as gold rallied as investors were rattled by signs the U.S. presidential race was tightening just days before the vote.

Uncertainty about the outcome of the election pushed U.S. Treasury yields to their lowest in a week, while crude oil extended losses after U.S. government data showed a much bigger-than-expected build in inventories.

Investors were beginning to rethink their long-held bets of a Nov. 8 victory for Democratic candidate Hillary Clinton amid signs her Republican rival Donald Trump could be closing the gap, deepening the recent decline across major stock markets.

Weakness on Wall Street, on the heels of falling Asian and European stocks, sent MSCI’s 47-country “All World” index .MIWD00000PUS down 0.42 percent.

While Clinton held a 5 percentage point lead over Trump, according to a Reuters/Ipsos opinion poll released on Monday, some other polls showed her Republican rival ahead by 1-2 percentage points.

“As the polls change, the market is growing more nervous and is beginning to price in a Trump presidency,” said Andre Bakhos, managing director at Janlyn Capital LLC in Bernardsville, New Jersey.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza