Markets recoil as US poll swings to Trump, Rand strengthens after Zuma dropped

03 November 2016 - 09:28 By AFP, Bloomberg, TMG Digital

Global markets took a dive yesterday after a US opinion poll showed Donald Trump with a narrow lead over Hillary Clinton less than a week before they face off in the presidential election. The JSE retreated fairly sharply in sympathy with the international anxiety over the US election result on Tuesday.The All-Share Index dropped 1.49% to 50241.60 points, its weakest intraday low since late June, pressured by mining stocks in particular."The lead up to the US presidential election was always expected to be lively, but events of the last couple of days have seriously taken their toll on investor sentiment, as is clearly evident across a number of asset classes again today," said Oanda senior market analyst Craig Erlam.The local share market was also pressured by renewed strength in the rand after President Jacob Zuma dropped his application to interdict the release of the public protector's state-capture report.The rand was firmer at R13.4831/$1 in early trade - from Tuesday's R13.5939. It was at R14.9422/à1 from R15.0326, and R16.5410/£1 from R16.6435.Another beneficiary of stock market weakness was gold, which rose for a fifth day towards $1300/oz on fear that Trump might emerge victorious.With the Republican candidate seen as a riskier choice for global growth, gold has been in demand, with investors seeking safe haven.The US dollar was weak against other currencies, which provided decent support to some commodity prices, including copper, which rallied to its best level since late July at about $4920 a ton.Europe's leading markets were weaker, as were US stock futures ahead of the conclusion of the two-day US Federal Reserve's policy meeting last night. The markets expected the Fed to keep key interest rates unchanged.Major European stock markets opened lower in the wake of a dip on Tuesday on Wall Street (down 0.7%), followed by plunges in Tokyo (1.76%) and Hong Kong (-1.45%) on fears that maverick Trump could win the vote."It's clear that markets would much prefer the stability that a Clinton victory would bring and the reaction since the polls started to change so dramatically just confirms this," Craig Erlam, a senior market analyst at Oanda, said.An ABC News-Washington Post tracking poll on Tuesday showed Trump ahead 46% to 45%, while other polls still put Clinton in the lead, but suggest the race has narrowed as November 8 looms.The estate mogul boasted about the new numbers as he addressed a raucous crowd - chanting "Lock her up!" and "Drain the swamp!" - in Eau Claire, Wisconsin.Renewed FBI scrutiny of Clinton's controversial use of a private e-mail server as Secretary of State has excited the Republicans and underlined public doubts about the Democrat's trustworthiness.But when Clinton took the stage at a rally in Fort Lauderdale late on Tuesday, her rhetoric was backed by a new survey of early voters that shows her winning Florida."I'll tell you what!" she declared, her voice cracking, but her tone triumphant, "Donald Trump has proven himself to be temperamentally unfit and unqualified to be president of the US." ..

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