Shares in Europe’s renewable energy sector plunged and prices for crypto currencies such as Bitcoin neared all-time highs, as traders raced to get onside of the financial implications of the sweeping Republican Party victory across a raft of sectors and niches.
Control of the US presidency, senate and possibly the House of Representatives means the incoming Trump regime will have a rare opportunity for legislative and administrative freedom of action for its policy platform.
Donald Trump’s victory also fuelled rallies in US stocks and punished bond prices as expectations of tax cuts and tariffs on imports boosted expectations of short-term economic growth.
The benchmark S&P 500 index of leading US shares jumped 2pc to a record high.
But on the bond market, where investors focus on a longer time-span, US bonds fell, as the Trump agenda stoked fears of renewed inflation and a bigger deficit to fund spending promises.
Everywhere you look, there’s thumbprints of the election results
That in turn fed into the dollar, which strengthened on a bet that Trump’s policies will keep interest rates higher for longer, again by stoking inflation.
Trump has pledged to raise tariffs on imports to protect or promote US manufacturing jobs, to cut taxes – including corporation tax – and to slash regulations including in the tech sector.
As US domestic stocks rose, assets in America’s key trading partners fell.
Mexico was hard hit. The peso fell in early trading, though it staged a comeback later in the day, thanks to the country’s own domestic news.
The euro fell even further, edging towards parity with the dollar.
A person waves a flag outside Trump Tower in New York. Photo: Reuters
“Everywhere you look, there’s thumbprints of the election results,” said Paul Christopher, head of global investment strategy at the Wells Fargo Investment Institute.
In Ireland, one of the most exposed countries in the world if the US builds up a trade wall, shares fell sharply. The Iseq index of leading Irish shares fell 1.67pc compared to a .5pc fall for the French CAC index.
In Dublin, Glanbia was down 6.68pc and Kerry down 3.36pc. Both have significant operations in the US. Bank of Ireland, seen by many as a proxy for the Irish economy, also fell sharply.
Back in New York, meanwhile, Donald Trump was one of the big financial winners of the day. Shares in his majority owned Trump Media and Technology Group surged over 20pc, while stock in Tesla, headed by his supporter Elon Musk, jumped 14pc.
The euro fell even further, edging towards parity with the dollar
Bitcoin surged to a record high. The Trump campaign had secured significant support from crypto investors who are pushing for a softer line on regulation.
Traditional oil and heavy industry in the US also looks set to benefit from a promised return to economic policies unchecked by climate targets or concerns.
Among the strangest financial results of the day was Austria’s Raiffeisen Bank, its shares rose 7pc making it Europe’s best performing bank stock.
Raiffeisen has an unusually large exposure to Russia, via a subsidiary there that it has been unable to offload despite the war in Ukraine.
