Currencies jumpy, stocks stable with all eyes on US election
Dollar and bonds set to react to US vote
China blue chips jump 2% on stimulus expectations
USD/CNH implied volatility near record high
Recasts, updates prices at 0845 GMT
By Lawrence White
LONDON, Nov 5 (Reuters) -Stocks were steady on Tuesday but implied volatility ratcheted up in currency markets in an early indication of the market frenzy to come, as the world awaits the outcome of a knife-edge U.S. election.
Overnight implied volatility options for euro/dollar spiked to the highest since November 2016, as did those for the dollar-Mexican peso pair MXNONO=,in recognition that the latter could be hard hit by protectionist policies if Republican Donald Trump defeats Democrat candidate Kamala Harris.
Europe's benchmark STOXX index edged down 0.2% while MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS inched 0.7% higher, as stock markets held their breath ahead of Wednesday's open.
Currencies, which unlike shares trade around the clock, saw more action albeit still offering only scattered and contradictory indications of which candidate investors were betting on.
The dollar, which had eased as traders made final tweaks to positions, bought 152.46 yen JPY=EBS and changed hands at $1.0879 per euro EUR=EBS.
"They've priced what they think is price-able and that's that," said Westpac strategist Imre Speizer, adding that a clear win for Trump would lift the dollar, while a win for Harris would push it a little lower.
Bitcoin BTC= added 2.7% to about $68,884, with Trump viewed by analysts as enacting more favourable policies for cryptocurrencies than Harris.
Election day ends an acrimonious campaign jolted by assassination attempts on Trump and the withdrawal of President Joe Biden in favour of Harris, with polls showing the candidates virtually tied.
Markets are on edge about how Trump's protectionist trade policies in particular could stoke inflation and hit exports in the world's biggest consumer market with bonds and the dollar expected to move on the outcome of the election.
"Ultimately the U.S. election comes down to this - whether the U.S. electorate wants to vote for economic policy continuity, institutional stability and liberal democracy (Harris) or radical trade policy, a further retreat for globalization and strongman democracy (Trump)," J.P. Morgan analysts said in a note. "In short, a vote for stability or change."
BRACED
China is seen on the front line of tariff risk and the currency in particular is trading on tenterhooks with implied volatility against the dollar CNHSWO= around record highs.
The yuan CNY=CFXS hovered at 7.1083 per dollar, while Chinese stock markets surged to almost one-month highs as investors expect a meeting of top policymakers in Beijing this week to approve local government debt refinancing and spending.
China's blue chip CSI300 .CSI300 jumped 2.5% and Hong Kong's Hang Seng .HSI rose 1.4%. .SS
The Australian dollar barely reacted after the central bank held rates, as expected, with all eyes on the election and the Aussie AUD=D3 was last marginally firmer at $0.6614.AUD/
"Simply, if Harris wins, we like selling dollar/yen and buying AUDUSD," said a currency strategists at Citi. "If Trump wins, we like buying USD against EUR, SEK, and NOK."
Treasury markets, which have priced in a U.S. interest rate cut for Thursday, held their ground in early European trading with 10-year U.S. yields US10YT=RR at 4.32%.
Euro zone bond yields edged up, with Germany's 10-year bond yield DE10YT=RR climbing nearly 2 basis points to 2.41%, a little below last week's three-month high of 2.447%.
Oil held sharp overnight gains on delays to producers' plans for increased output, leaving benchmark Brent crude futures LCOc1 at $75.24 a barrel after a 3% rise on Monday. O/R
When U.S. election results roll in after midnight GMT the focus will be on the battleground states of Georgia, North Carolina, Pennsylvania, Michigan, Arizona, Wisconsin and Nevada.
A winner may not be known for days and Trump has signalled that he will attempt to fight any defeat, as he did in 2020.
World FX rates YTD http://tmsnrt.rs/2egbfVh
Reporting by Lawrence White in London and Tom Westbrook in Singapore, Editing by Shri Navaratnam and Christina Fincher
Asset collegati
Ultime news
Disclaimer: le entità di XM Group forniscono servizi di sola esecuzione e accesso al nostro servizio di trading online, che permette all'individuo di visualizzare e/o utilizzare i contenuti disponibili sul sito o attraverso di esso; non ha il proposito di modificare o espandere le proprie funzioni, né le modifica o espande. L'accesso e l'utilizzo sono sempre soggetti a: (i) Termini e condizioni; (ii) Avvertenza sui rischi e (iii) Disclaimer completo. Tali contenuti sono perciò forniti a scopo puramente informativo. Nello specifico, ti preghiamo di considerare che i contenuti del nostro servizio di trading online non rappresentano un sollecito né un'offerta ad operare sui mercati finanziari. Il trading su qualsiasi mercato finanziario comporta un notevole livello di rischio per il tuo capitale.
Tutto il materiale pubblicato sul nostro servizio di trading online è unicamente a scopo educativo e informativo, e non contiene (e non dovrebbe essere considerato come contenente) consigli e raccomandazioni di carattere finanziario, di trading o fiscale, né informazioni riguardanti i nostri prezzi di trading, offerte o solleciti riguardanti transazioni che possano coinvolgere strumenti finanziari, oppure promozioni finanziarie da te non richieste.
Tutti i contenuti di terze parti, oltre ai contenuti offerti da XM, siano essi opinioni, news, ricerca, analisi, prezzi, altre informazioni o link a siti di terzi presenti su questo sito, sono forniti "così com'è", e vanno considerati come commenti generali sui mercati; per questo motivo, non possono essere visti come consigli di investimento. Dato che tutti i contenuti sono intesi come ricerche di investimento, devi considerare e accettare che non sono stati preparati né creati seguendo i requisiti normativi pensati per promuovere l'indipendenza delle ricerche di investimento; per questo motivo, questi contenuti devono essere considerati come comunicazioni di marketing in base alle leggi e normative vigenti. Assicurati di avere letto e compreso pienamente la nostra Notifica sulla ricerca di investimento non indipendente e la nostra Informativa sul rischio riguardante le informazioni sopra citate; tali documenti sono consultabili qui.
