Stock market reacts to Donald Trump presidency

(VOVworld)- At the end of the trading session on Wednesday, the US securities market soared with financial, health care and industrial stocks rising sharply reflecting investors’ hope that President-elect Donald Trump will keep his promise of increasing investment in infrastructure. Meanwhile, stock markets in Asia and Europe and Mexico are negatively reacting to an imminent Donald Trump presidency.
Stock market reacts to Donald Trump presidency  - ảnh 1
Stock markets initially swooned but then recovered as the reality of Donald Trump's victory set in. (Alex Kraus/Bloomberg)

Stock exchanges around the world have strongly responded to Donald Trump’s victory in the US Presidential Election, as they did following the UK’s decision to leave the European Union. At the opening on Wednesday in Frankfurt/Main, Germany’s key DAX index lost 2.84%, Mdax lost 2.4% and TecDax 2.15%. The FTSE 100 opened with a decline of 1.87% in London, 2.83% in Paris and 3% in Milan. In Asia, the Nikkei fell 5.4% to 1,301 points. The Hang Seng Index in Hong Kong lost 3% and KOSPI in Seoul down 3%. According to Chief Economist Holger Sandte of the Nordea Bank, if Mr. Trump implements his plan, the US bond interests would increase sharply pressing the US and the global economy. Observers say the Fed is unlikely to increase its interest rates in December. Mr. Jorg Kramer, Chief Economist of the Commerzbank said that in the long term Donald Trump’s presidency will hurt the German and global economy. He said Mr. Trump opposes trade liberalization. So not only Mexico, Canada, and China will be affected, world trade will also be seriously hurt.

Donald Trump’s victory cast a shadow on Mexico’s economy. On Wednesday, the  Mexican peso fell another 8% to its lowest point in 25 years due to fear that Mr. Trump will keep his promise to withdraw from the North America Free Trade Agreement which involves the US, Mexico, and Canada, Investors are worried about a possible bilateral trade war that could push the Mexican economy into a crisis. President-elect Donald Trump has proposed a tariff of 35% on a number of goods imported from Mexico in order to reduce the US trade deficit.