ARTICLE AD BOX
A screen displays the Nikkei 225 Stock Average figure on the trading floor at the Nomura Securities Co. headquarters in Tokyo, Japan, on Jan. 11, 2024.
Bloomberg | Bloomberg | Getty Images
SINGAPORE — Asia-Pacific markets were set to open mostly higher Wednesday after Wall Street surged overnight ahead of the U.S. presidential election results.
Japan's Nikkei 225 appeared set to open higher, with the futures contract in Chicago at 39,050 and its counterpart in Osaka at 38,980 compared to the index's last close of 38,474.9.
The Bank of Japan's monetary policy meeting minutes will be released later in the day, which could give insights on where the memebers stand on the bank's policy path.
Hong Kong's Hang Seng index futures were at 20,962, lower than the HSI's last close of 21,006.97.
A five-day meeting of China's National People's Congress (NPC) will continue on Tuesday, with investors watching for information on additional stimulus and polices aimed at stabilizing the economy.
Australia's S&P/ASX 200 rose 0.7% higher.
Overnight in the U.S. the S&P 500 index gained 1.23% to close at 5,782.76, while the Nasdaq Composite advanced 1.43% to 18,439.17. The Dow Jones Industrial Average climbed 427.28 points, or 1.02%, to settle at 42,221.88.
The race between former President Donald Trump and Vice President Kamala Harris is expected to be tight. Focus will also be on Congressional polling, given that a sweep by either party could impact spending and tax policy.
— CNBC's Jesse Pound and Samantha Subin contributed to this report.
CNBC Pro: These 2 stocks beat the S&P 500 in election Novembers no matter who won
Two stocks have outperformed the S&P 500 every November when elections have been held over the past three decades — regardless of the outcome, according to a CNBC Pro study.
CNBC Pro screened for stocks currently in the MSCI World Index that gained more than the S&P 500 — or lost less than the index — in November of every election year since 1988. The 36-year period has seen four Republicans and five Democrats elected to the White House.
CNBC Pro subscribers can read more about the two stocks here.
— Ganesh Rao
Watching the dollar will be critical Tuesday night, strategist says
Investors should keep a close eye on the dollar Tuesday night, according to Jefferies chief market strategist David Zervos.
"That will be the most liquid and the most transparent messaging to what we are getting markets to do, because that's where people can put money to work fast. It's going to be hard to put money, obviously, into any sector, credit. There won't be liquidity for that in bonds," he said on CNBC's "Money Movers" on Tuesday morning. "In times of stress we go to the dollar, at least temporarily, especially if it's global stress and even if it's U.S.-led stress."
Investors widely expect the U.S. dollar will become stronger if Trump regains the presidency. Zervos added that many in the speculative community have bet on the dollar-China trade as a Trump-winning trade.
— Lisa Kailai Han
Investors should sell a Trump rally or buy a Harris dip, says Citi's Scott Chronert
Investors should sell a potential rally in the market if Trump wins the election, according to Citi's Scott Chronert.
"Your starting point is a fairly extended valuation circumstance that's predicated on very strong earnings growth follow-through into 2025," the bank's U.S. equity strategist told CNBC's "Squawk on the Street" on Tuesday. "Our concern is that with that set up, you go into a Trump win and you introduce tariffs into the discussion … [and] 2025 growth expectations become a bit more suspect as we navigate tariff action."
On the other hand, if Harris is victorious, Chronert said investors should consider buying an anticipated market dip.
"It really comes down to Trump and tariffs, and Harris and taxes," he said.
— Sean Conlon
Oil market could face volatility if Trump wins, Goldman Sachs says
A second Trump administration is more likely to bring volatility to the oil market, according to Goldman Sachs.
Donald Trump could tighten sanctions on Iran, reducing supply from the Islamic Republic and putting upward pressure on prices in the short term, the investment bank told clients in a Monday note.
Oil prices rose about 1% as voters in the U.S. headed to the polls. U.S. crude oil had gained 35 cents, or 0.49%, to $71.82 per barrel by 8:56 a.m. ET. Global benchmark Brent crude futures added 33 cents, or 0.44%, to $75.41 per barrel.
"Conceptually, the impact of a potential second Trump term on oil prices is ambiguous," Yulia Zhestkova Grigsby, vice president of commodity research at Goldman Sachs, told clients in a note Monday.
Over the medium term, however, a second Trump administration could heighten trade tensions through tariffs, putting downward pressure on global oil demand and prices, according to Goldman.
— Spencer Kimball
Stocks could sell off after election, Nomura says
Strategists at Nomura think stocks could see a bout of selling after the U.S. presidential election, given current positioning among hedge funds and other major investors.
"The substantial accumulation of long positions in U.S. equities by real-money investors and macro hedge funds (among others) suggests that the market reaction to a red sweep could be an initial spike followed not long thereafter by a bout of 'selling the fact,'" Nomura said in a note.
Indeed, the S&P 500 is less than 3% below a record high set Oct. 17.
SPX year to date
— Fred Imbert
Stocks rise on presidential election days, recent history shows
It is shaping up to be another winning presidential Election Day for stocks.
The Dow, S&P 500 and Nasdaq Composite are all tracking for gains on Tuesday. If that holds through session close, it would mark the fifth straight positive presidential Election Day for the blue-chip Dow.
What's more, 2024 would be the sixth winning presidential Election Day in a row for the S&P 500 and Nasdaq.
— Alex Harring, Peter Schacknow
English (US)