U.S. election worries hits global stocks, dollar

Wed Nov 2, 2016 5:10pm EDT
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By Saqib Iqbal Ahmed

NEW YORK (Reuters) - Global equity prices and the dollar slid for the second straight day on Wednesday, while safe-haven assets such as gold rallied as investors shunned risk in response to signs the U.S. presidential race was tightening just days before the vote.

Uncertainty about the outcome of the Nov. 8 election pushed U.S. Treasury yields to their lowest in a week, while oil prices slumped on data showing a record U.S. crude stock build that stoked worries about a persistent global supply glut.

Investors were beginning to rethink their long-held bets of a victory for Democratic candidate Hillary Clinton amid signs her Republican rival Donald Trump could be closing the gap, deepening the recent decline across major stock markets.

Weakness on Wall Street, on the heels of falling Asian and European stocks, sent MSCI's 47-country "All World" index .MIWD00000PUS down 0.74 percent, close to a four-month low.

While Clinton held a 5 percentage point lead over Trump, according to a Reuters/Ipsos opinion poll released on Monday, some other polls showed Trump ahead by one to two points.

"The main driver for today is concerns regarding the election. It looked like Clinton was going to win and now that Trump is gaining momentum, it's making people nervous," said Neil Massa, senior equity trader at Manulife Asset Management in Boston.

A Reuters equity market poll last month showed a majority of forecasters predicted that U.S. stocks would perform better under a Clinton presidency than a Trump administration.

U.S. stocks extended losses after the Federal Reserve kept interest rates unchanged but signaled it could hike in December.   Continued...

A man walks past at an electronic board showing the Japanese yen's exchange rate against British pound (R) and Euro outside a brokerage in Tokyo, Japan, July 6, 2016. REUTERS/Issei Kato