Asia shares, Dow futures, oil price sink as Trump leads in vote count

HONG KONG — The increasingly likely prospect of a Donald Trump presidency roiled North American futures markets and sent Asian stocks and oil prices tumbling in Wednesday trading, setting up what was likely to be a rough ride for investors in Canada, where energy and commodity prices are key.

After scoring gains earlier — when it seemed like Democrat candidate Hillary Clinton would thump her Republican foe — Japan’s Nikkei 225 index dropped a whopping 6.1 per cent, while market benchmarks in Australia, South Korea’s and Hong Kong tumbled similar amounts.

Dow and S&P futures also plunged after safe-play stocks, such as utilities and phone companies, were among the biggest gainers on Tuesday as investors focused on the U.S. presidential election.

Wall Street had largely seen Clinton as more likely to maintain the status quo, while viewing Trump’s polices as less clear.

“Rightly or wrongly, markets are going to be concerned about a Trump victory, particularly given the potential consequences for world trade and its impact on many large companies in the U.S. stock market,” said Ric Spooner, chief analyst at CMC Markets in Sydney.

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“Like Brexit, the rally over the last two days increases the downside potential.”

Spooner compared the situation to the sharp global market declines following the Brexit vote in which Britain unexpectedly voted to leave the European Union.

Among Trump’s campaign statements that have sparked concerns are his threat to restrict immigration to the U.S., renegotiate the North American Free Trade Agreement that takes in Canada and Mexico and scuttle the Pacific Rim trade initiative known as TPP.

Currencies, especially the Mexican peso, took a hit as Trump edged toward the winner’s circle. The peso, which had been viewed as a proxy for Trump’s chances of winning, plunged more than 11 per cent, while the U.S. dollar fell against the yen.

In overnight trading, the Canadian dollar dipped more than a full cent against the greenback.

Concerns about a Trump presidency spread to oil prices, which saw benchmark U.S. crude futures down $1.65 to $43.33 a barrel in electronic trading on the New York Mercantile Exchange.

About the only winner amidst the turbulence was gold — seen as a safe haven in times of uncertainty — which soared 4.7 per cent.

— With files from The Canadian Press

The Associated Press