GBP/USD: Pound vs. Dollar Volatile Due to Trump Trade War
  • Asia equities up in a volatile trading day.
  • Traders keenly following US counting progress, which can impact sentiment.
  • EU Stoxx 50 index might surrender recent strength.

Asia-Pacific equities traded mostly in the green during a rough day as the US election results trickled in. Japan’s Nikkei 225 went up by 1.72 Percent, and Hong Kong Hang Seng’s index rose by 0.45 Percent; Australia’s ASX 200 traded close to the neutral region, shedding just 0.1 Percent.

In the currency market, havens were in demand while risk-associated AUD, CAD and NOK sold off. Gold prices went back below 1,900 dollars an ounce while silver prices got hit by a 1.7 Percent fall. The yields on US 10-year Treasuries fell by nine basis points.

The economic docket today contains composite PMIs from Europe and US trade balance numbers in a day when US election results would keep the limelight.

The spread of the pandemic in Europe and subsequent lockdown measures in recent days have raised concerns about the sustainability of the current economic revival in the block. The risk assets from the region see less demand.

Pro-risk assets might be more pressurised ahead as the chances of a Trump win has gone up as the counting progressed today. He is in pole position in several battleground states. Florida, South Carolina, Iowa, Ohio, Michigan, Pennsylvania and Wisconsin might favour the current president.

Return of Trump as president might not be favourable for European assets as his reign has caused fractured relations between the two continents. He had imposed tariffs on aluminium and steel products; and had threatened to push for more import duties.

Risk aversion is likely to dominate the markets in the days ahead after uncertain US election results.