Global stocks are gyrating as investors continue predicting that Donald Trump will win the election, signalling a continuity of US policies. In Asia-Pacific, the Nikkei 225, Hang Seng, and DJ New Zealand are up by 1.75%, 0.20%, and 0.60%, respectively.
Similarly, in the United States, futures tied to the S&P 500 and Nasdaq 100 index are up by 0.30% and 2%, respectively. The Dow Jones and Russel 2000 are down by 0.15% and 1.20%. In Europe, futures tied to the DAX index and FTSE 100 are down by 0.90% and 0.35%, respectively.
By yesterday, the fear and greed index was at 32, which is a sign that investors are getting fearful about the market.
Counting of votes in the US is going on with votes from key battleground states yet to be announced. According to the Wall Street Journal, Biden is leading by 224 votes while Donald Trump has 213 votes. However, while Biden seems to have an upper hand, a closer look at the electoral college shows a different situation.
For example, Donald Trump is leading in key states like Pennsylvania, Michigan, and Wisconsin. If he wins the three and their 56 votes, he will only require a single vote, which could come from North Carolina, where he is leading.
Meanwhile, in the currencies market, the US dollar index has jumped by 0.50%, in further evidence that investors are also pricing-in a Trump victory. All constituent currencies of the index, including the Japanese yen, euro, and sterling are also in the red.
Today, in addition to the election, investors will react to important corporate earnings, economic data, and the happenings with Ant Financial. On earnings, the top companies in Japan to watch will be Softbank, Itochu, Subaru, and Marubeni. In Europe, we will receive results from BMW, Danske Bank, and Intesa San Paolo. In the United States, the key firms to watch will be QUALCOMM, Vestas, and MetLife.
On economic data, we will receive global services PMI numbers and ADP private sector jobs estimates. The Hang Seng will keep reacting to news that China has paused the dual listing of Ant Financial, a company partly owned by Jack Ma and Alibaba.
Dow Jones technical outlook
The Dow Jones index is wobbling today as traders wait for the official election results. The index is trading at $27,308, which is slightly below the intraday high of $27,828. It is still above this week’s low of $26,000. On the daily chart, the index is along the 78.6% Fibonacci retracement level.
It is also along the standard pivot point and slightly above the 25-day and 15-day exponential moving averages. Therefore, the outlook for the Dow Jones is neutral, with the key support and resistance levels being at $26,000 and $28,400.
Dow Jones Daily Chart