As US presidential votes continue to be counted, bitcoin is a clear winner and the ASX is riding the election excitement.
Bitcoin beat its previous record high to reach nearly $US74,000 ($112,908).
In the US, the S&P 500 index ended election day (Tuesday 5 November) up 1.23%, while the Nasdaq 100 lifted 1.32%. Meanwhile, the Cboe Volatility Index (VIX) – a barometer of equity market volatility – was down 6.78%.
Saxo Bank Asia Pacific senior sales trader Junvum Kim says the market is showing a “calm before the storm” pattern, with US equity futures rising and the VIX decreasing, even though this election is expected to be one of the closest in recent history, potentially causing delayed results.
“Meanwhile, implied volatilities for currencies and treasuries remain elevated ahead of the FOMC rate decision later this week,” Kim says.
“The MOVE index, which monitors expected yield fluctuations, has reached its highest level since October 2023.
“Additionally, the overnight volatility of the Chinese Yuan has climbed to its highest point since 2011, surpassing levels seen in the last two elections. As a result, further hedging or speculative price action is anticipated for at least the rest of the week.”
Saxo Bank chief macro strategist John Hardy says markets are already trying to call a win.
“Markets are piling into the Trump 2.0 Trades (Bitcoin is the night’s big winner in percentage terms) as everything is going his way as votes accumulate and Harris’ path to victory looks increasingly unlikely,” he says.
“While patience is still required, markets are already trying to call this.
“It is important to remember that ‘proper’ Trump 2.0 Trades require control of the House – it will possibly be days before we know the results of all House elections. However, with Trump’s popular vote so much stronger than the last two elections, the odds are leaning higher.”
The New York Times places a Trump victory at 90%.
Down under, the S&P/ASX 200 finished 67.70 points, or 0.83%, higher at 8,199.50 points. Over the last five days, the index is virtually unchanged, but is currently 2.21% below its 52-week high.
Eight of the 11 sectors ended the trading session in the green, with information technology the best performing sector with a 1.81% daily gain and a 3.23% increase over the past five days. Materials, however, edged back 0.21% and energy was down 1.03%.
IGO (ASX:IGO), Liontown Resources (ASX:LTR), Ramelius Resources (ASX:RMS) and Pilbara Minerals (ASX:PLS) all ended the day lower. IGO slid 5.60% to $5.06, Liontown slipped 4.27% to $0.79, Ramelius retreated 3.02% to $2.25 and Pilbara Minerals dipped 3% to $2.91.
The S&P/ASX200 is Australia’s leading share market index and contains the top 200 ASX-listed companies in terms of market capitalisation, and accounts for about 80% of the country’s equity market. The index is designed to measure the performance of the 200 largest index-eligible stocks listed on the ASX by float-adjusted market capitalisation
It is recognised as the institutional investable benchmark in the country.
Write to Angela East at Mining.com.au
Images: Stock & ASX
