May 9, 2021

US tech stocks lead volatile rally after Trump claims he won the election and demands the Supreme Court to stop counting votes

http://feedproxy.google.com/~r/typepad/alleyinsider/silicon_alley_insider/~3/DliDZnIpyWo/stock-markets-futures-dollar-trump-and-biden-race-2020-11
Joe Biden Donald Trump debate
Joe Biden and Donald Trump speak during the first presidential debate at the Case Western Reserve University and Cleveland Clinic in Cleveland, Ohio on September 29, 2020.

  • US tech stocks led a volatile rally after President Donald Trump claimed victory and demanded the Supreme Court to stop counting votes.
  • Futures on the technology-heavy Nasdaq 100 rose 2.4%, after having surged 3% earlier, while Bitcoin and crude oil rallied sharply.
  • Trade-sensitive currencies, like the Mexican peso and the Chinese yuan fell, along with safe-havens such as gold and the Japanese yen.
  • Visit Business Insider’s homepage for more stories.

US stock futures and the dollar rallied on Thursday, as the close presidential race that investors had expected played out, giving a boost to technology shares, crude oil, and cryptocurrencies.

After President Trump falsely declared himself the winner and called for the Supreme Court to stop counting votes, traders bet on technology stocks rising higher. Futures on the tech-heavy Nasdaq 100 rose by 2.4%, while those on the S&P 500 and the Dow Jones wavered between gains and losses.

By around 04:20 a.m. ET, there was no clear leader as yet in the presidential race between President Donald Trump and Democratic presidential Joe Biden as results continue to come in. Polls have now closed or are closing in most states, including several key battlegrounds. President Trump has won the key battleground state of Florida

Other more risk-sensitive assets such as oil and Bitcoin bounced, while more safe-haven assets like gold and the Japanese yen came under fire. 

The Cboe Volatility Index futures, or VIX, rose 4% to 35.6, but was still lower than its four-month-high last week.

Even with a close race, volatility remained fairly modest, as investors had already long positioned for the result to take far longer than election night to be clear.  

“As the night grinds on Donald Trump appears to have staged a remarkable comeback, as polling across the US suggests he has had a good night. The market reaction has so far avoided the volatility of 2016, at least on the downside, with yet more gains for stock futures,” Chris Beauchamp, chief market analyst at online broker IG.

“This impressive recovery by the party viewed as pro-business has been taken in a positive vein by markets, although there is still a lot of counting to be done.”

The dollar index rallied by 0.4%, driven by gains against the yen, which fell 0.4% and the euro, which shed 0.5%. 

Blue-chip shares in Asia were swept higher by the optimism across US markets. Japan’s Nikkei was the strongest performer, up 2% thanks to the weakness in the yen, while Seoul’s KOSPI rose 1%. Chinese and China-sensitive indices were more muted. The Shanghai Composite was almost unchanged on the day, as was Australia’s S&P/ASX 200.

Here’s what’s going on in the most election-sensitive markets:

Top 5 Gainers

Asset Last Price Percent Change
Bitcoin $13,895  3.52%
Nasdaq 100 Futures  11,569 points 2.70%
WTI Crude Futures $38.52 a barrel 2.28%
Dollar/Mexican Peso  MXN 40.55  2.12%
S&P 500 Futures 3,399 points 1.13%

Top 5 Losers

Asset Last Price Percent Change
10-Yr Treasury Yields  0.928% -7.70%
VIX Futures 31.2 points -1.35%
Gold $1,910.35 an ounce -0.48%
Euro/Dollar $1.1713 -0.38%
Offshore Yuan/Dollar 6.7034 -0.32%