Dow Jones surges 491 points after US midterm elections



November 08, 2018 07:55:25

The local share market is set to open moderately higher, following Wall Street’s relief rally over the conclusion of the United States midterm elections.

Markets at 8:25am (AEDT):

  • ASX SPI 200 +0.7pc at 5,905, ASX 200 (Wednesday’s close) +0.4pc at 5,897
  • AUD: 72.77 US cents, 55.41 British pence, 63.62 Euro cents, 82.58 Japanese yen, $NZ1.07
  • US: Dow Jones +2.1pc at 26,180, S&P 500 +2.1pc at 2,814, Nasdaq +2.6pc at 7,571
  • Europe: FTSE +1.1pc at 7,117, DAX +0.8pc at 11,579, CAC +1.2pc at 5,138, Euro Stoxx 50 +1.1pc at 3,244
  • Commodities: Brent crude -0.1pc at $US72.03/barrel, spot gold -0.1pc at $US1,225.68/ounce, iron ore -0.6pc at $US75.27

It was a result financial markets had expected — with Democrats taking the House of Representatives and Republicans still retaining their Senate majority.

Investors piled into technology and healthcare stocks, in particular. A divided House means it could be tougher for the Trump administration to pass laws which tighten regulations in those two sectors.

This led to the tech-heavy Nasdaq index lifting sharply, up 2.4 per cent to 7,552.

The benchmark S&P 500 added 1.9 per cent to 2,808.

Meanwhile, the Dow Jones index shot up 491 points, or 1.9 per cent, to 26,126.

Shares in Google (+3.2pc), Netflix (+4.8pc) and Amazon (+6.3pc), which have been heavily sold-off in the last month, rose sharply overnight.

European markets were also relived that some certainty has returned, and that the US election is over.

The main London and Paris stock indices posted strong gains, rising by 1.1 and 1.2 per cent respectively. Frankfurt’s DAX index rose 0.8 per cent.

While the US share market surged, the greenback weakened against major currencies overnight.

That led to the Australian dollar rising to 72.8 US cents, its highest level in about seven weeks.

The local currency also lifted to 55.4 British pence and 63.6 Euro cents.

More to come.







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