Stocks climb, bonds fall on Obama victory
“People are hoping that we are seeing a path here to a resolution of one key uncertainty on the investment scene; who will be the leader of the free world,” said David Dietze, chief investment strategist at Point View Financial Services, Summit, New Jersey.
U.S. Treasury prices fell as the safe haven bid waned with global stocks rising. The 2-year note’s price traded down 3/32 for a yield of 1.44 percent.
“Money is coming out of the very shortest end (of Treasuries) and going into stocks and spread product.” Dietze said. “People are just more willing to invest in anything as opposed to being on the sidelines,” he said.
New Yorker business writer James Surowiecki has more:
It’s been interesting to watch the after-hours trading in the S. & P. futures, particularly around 9:30 P.M., when CNN and Fox both called Ohio for Obama, effectively (I think) clinching his victory. The announcement made essentially no impact on the futures market, which I think suggests that investors were already collectively expecting an Obama victory. So does the fact that in the last half hour the futures, which had been down earlier in the session, kept rising, so that they’re now actually up from today’s close. In other words, there’s no sign that investors are panicked at the thought of an Obama Presidency.
Of course, the market also knows at this point that it’s unlikely that the Democrats will get sixty seats in the Senate, which it’s fair to say many people on Wall Street were really concerned about. So that may have something to do with investors’ relative sanguinity. As for world markets, they’re still rallying, with Australia up almost two per cent and Hong Kong up 5.5 per cent. The Japanese? They’re still on their lunch break, but the Nikkei was up almost three per cent this morning. So at the moment, the global rally continues.