As I write this the Dow futures have heavily swung down and are in the red.
As U.S. television networks called the presidential election for Barack Obama at 11 p.m. on the East Coast and cued up celebrations in Chicago’s Grant Park and across the country, Japanese stock traders in the middle of their Wednesday afternoon workday had a very different reaction.
In trading in the half hour after the victory announcement, the Japanese Nikkei stock market declined steeply, falling from nearly 9,450 to below 9,250. Still, the index was up nearly 2 percent for the day on the strength of a rally earlier in the trading day.
Reuters quoted Tomomi Yamashita, a fund manager at Shinkin Asset Management, who noted that Obama’s tax proposals might have been behind the initial Japanese market reaction.
"His plan to tax higher income earners may dampen incentives a bit, and this might limit U.S. competitiveness,” he said, “and as far as the currency market is concerned, a Republican victory might have been better."
Markets across Asia were trading higher during the overnight hours in the United States, driven partly by news of a 305-point Election Day rally in the Dow Jones Industrial Average.
The Hang Seng Index in Hong Kong traded down slightly in the first half hour of trading after the Obama victory announcement, declining from 15,116.09 to 15,056.67.
The sock market in Seoul, South Korea, declined in the first half hour, too, slumping from 1,206.83 to 1,200.34.
