The UK stock market rose sharply on Thursday morning, following those in Asia last night, as world economies seem to react favourably to the prospect of Donald Trump as the next president of the United states, reports The Independent.
Anyone who bought German or French shares during Trump’s victory speeh on Wednesday morning has seen an almost 5 per cent boost in their value in one day.
The jump defies the doom-laden predictions of many City analysts who predicted a huge sell-off, if the Republican was victorious.
The consensus view was that Trumps unpredictability and protectionist economic policies would spook world markets but this simply has not materialised.
The FTSE 100 jumped up 1 per cent within minutes, and is now around 200 points above its level of the day before Tuesday’s election.
Asian equities also saw big gains on Thursday, joining a goldrush across world markets as the shock of a Trump’ victory was replaced by hopes his plan to kickstart the US economy will succeed.
Trading floors were awash in red on Wednesday as investors reacted to news that the firebrand tycoon had defeated establishment candidate, Hillary Clinton, upending expectations.
However, a reassuring victory speech – followed by calls by Clinton and President Obama to get behind Trump – provided some encouragement to traders, sending risk assets rallying.
Most markets in Asia either wiped out or clawed back most of the previous day’s losses, while the dollar pushed higher.
The currency had come under pressure as traders worried that Trump’s negative impact on the economy would cause the Federal Reserve to hold off an interest rate rise, but analysts said those worries had abated for now.
Tokyo closed up 6.7 percent, with a plunging yen also providing support. The dollar dallied with 106 yen before easing slightly, well up from Wednesday’s low of 101.20 yen.
In the afternoon Hong Kong gained 2.1 percent and Shanghai closed 1.4 percent up. Sydney closed 3.3 percent higher, Seoul jumped two percent and Taipei put on 2.4 percent.
There were also gains of more than one percent in Wellington, Singapore and Manila.
