Stock Market Today: Dow futures rise as investors see early Trump advantage - MarketWatch

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Nov. 5, 2024 at 10:09 PM EST

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15 min ago

By

Vivien Lou Chen

Tuesday evening's selloff in U.S. government debt picked up steam as the Associated Press reported that Republican Donald Trump had picked up 188 Electoral College votes versus 99 for Democrat Kamala Harris.

Yields on everything from 2- through 30-year Treasurys were jumping by at least 10 basis points each, according to FactSet data. The 10-year rate was up 15 basis points at 4.44%, while the 30-year yield was up roughly 17 basis points at almost 4.63%.

Bond-market participants are "behaving as if Trump is going to win," said Peter Azzinaro, a partner and senior portfolio manager at Agile Investment Management in Florida. "I'm not calling that, but that's how the market is leaning. I think there's a better than 55% chance he's going to win," he said, even if it's still a little early.

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30 min ago

By

Vivien Lou Chen

While a path toward the 270 Electoral College votes needed to take the White House remained in reach for both U.S. presidential candidates Tuesday, a rally in Dow futures and selloff in U.S. government debt indicated market participants were prepared for a victory by Republican Donald Trump.

The moves in both markets "make sense" given the way stocks and bond traders were expected to respond to a lead by Trump, according to Daniel Tenengauzer, New York-based head of macro and emerging markets for consulting group David Woo Unbound. "The main question is whether this will be a sweep. We think it will be a Republican sweep of the White House and Congress."

He added that Pennsylvania is the swing state that he's focused on because "we strongly believe if Trump wins Pennsylvania, then he wins the election.''

1 hour ago

By

Vivien Lou Chen

The Treasury-yield curve was in the process of bear steepening as Tuesday evening's early voting results continued to arrive, a trading pattern that strategists have associated with a victory by Republican candidate Donald Trump in the presidential election.

Tuesday's selloff in U.S. government debt was most pronounced in the long end of the curve, which sent corresponding yields up at a faster pace than rates in the shorter end. Live updates from the Associated Press had Trump with 101 of the 270 Electoral College votes needed to win the White House, while Vice President Kamala Harris had 71.

1 hour ago

By

William Watts

It's early, but market action as results come in Tuesday night indicates that investors see a path for Donald Trump to return to the White House, a veteran Wall Street strategist told MarketWatch.

"The Dow is up 265 points, so I think the market is anticipating a Trump victory," Sam Stovall, chief investment strategist at CFRA, said in a phone interview.

The 0.7% gain for Dow futures was accompanied by a 0.6% rise for S&P 500 futures, while the dollar was stronger versus major rivals, including making a strong gain against the Mexican peso. Bitcoin was also higher. The dollar and bitcoin were both seen as benefiting from a Trump victory.

The S&P 500 rallied 1.2% on Tuesday. On average, the S&P 500 has seen a 0.9% rally on presidential election days, rising 80% of the time. In the three days after Election Day, the market has seen an average fall of 0.9% but has gained ground half of the time, Stovall noted. Going back to World War II, the market was up an average of 1.5% from Election Day through the end of the year, rising 65% of the time.

That suggests but doesn't guarantee that stocks have room to rise, but not necessarily zoom off to the races, once uncertainty over the election clears up, Stovall said.

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2 hours ago

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Vivien Lou Chen

The around-the-clock foreign-exchange market responded to Tuesday evening's early voting results, which leaned in favor of former President Donald Trump, with the greenback jumping against the Mexican peso.

Just after 8 p.m. Eastern time, the dollar was up more than 1% against the peso, according to LSEG data. Live updates from the Associated Press had Trump with 95 Electoral College votes and Vice President Kamala Harris with 35. Mexico is regarded as being one of the likely losers of Trump's proposed trade tariffs.

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2 hours ago

By

Vivien Lou Chen

Early voting results showing Republican Donald Trump ahead of Kamala Harris in Electoral College votes triggered a selloff in long-dated U.S. government debt Tuesday evening, pushing 10- and 30-year yields higher and reversing declines from the New York session.

The 10-year rate was up about 5 basis points at almost 4.34% after ending the New York session at 4.29%. The 30-year yield was up 6 basis points at 4.51% after ending at almost 4.45% during U.S. trading hours on Tuesday.

Live election updates from the Associated Press showed Trump with 23 Electoral College votes, while Harris had three. Nationwide vote counting is still in its very early stages.

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2 hours ago

By

William Watts

Stock-index futures were creeping higher, with the U.S. dollar also firming versus major rivals as very early election results begin to come in, including from key swing states Georgia and North Carolina.

Futures on the Dow were up 0.6%, while S&P 500 futures gained 0.4% and Nasdaq-100 futures gained 0.2%. The ICE U.S. Dollar Index, a measure of the currency against a basket of six major rivals, was flat after an earlier dip.

Donald Trump had 61% of the vote in Georgia with around 13% of ballots counted, while Kamala Harris had 67.5% of the vote in North Carolina with 2% of results in, according to CNN. While still very preliminary, the market may be taking some comfort from Trump's showing in Georgia, a state he lost to Joe Biden in 2020, said Kathleen Brooks, research director at London-based XTB, in a note.

"We think that financial markets were wiping the slate clean on Tuesday, and that the real moves will happen once we have a better idea of who will win the election," she wrote. "The positive signs for Trump in Georgia is already boosting the dollar, and it suggests that USD is very sensitive to the results as they get announced."

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3 hours ago

By

William Watts

Polls are beginning to close, with the Associated Press calling a handful of states. But there's no news yet from major swing states that will likely determine the race. Keep up with the state-by-state calls here.

3 hours ago

By

Vivien Lou Chen

The ICE U.S. Dollar Index has the potential to trade either above 107 or below 100, depending on the results of Tuesday's presidential election, according to strategist Kit Juckes of Societe Generale.

In a note, Juckes described a potential win by Vice President Kamala Harris, without a clean sweep of Congress, as being "dollar unfriendly.'' Meanwhile, "the dollar likes the idea of [former] President Trump's fiscal plans,'' which include tax cuts, he said.

"My best guess is we trade at 100 or 107 if we get a clear outcome reasonably quickly," Juckes said. The chart below shows how the index has performed in the past six months.

3 hours ago

By

William Watts

Proxies for former President Donald Trump's trade policies — specifically bitcoin and the Chinese yuan — can help gauge what market participants are making of the election results, Julian Emanuel, strategist at Evercore ISI, said in a note.

Analysts and investors have flagged that the foreign-exchange market, given its depth and liquidity, will likely be the most sensitive to perceptions around the election outcome. The performance of the yuan and the Mexican peso are both expected to be closely watched.

The Cboe Volatility Index, a gauge of expected S&P 500 volatility over the coming 30 days, will offer a clearer signal when U.S. trading gets under way Wednesday morning, Emanuel said. Uncertainty over the outcome could see the VIX soar toward 38, while an outcome seen as "clean" could send it toward 15. The index's long-term average stands near 20. It fell back to around 20.50 on Tuesday.

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