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International

Global stocks retreat as US election hangs over markets

The global stocks rally is running out of steam as investors await election results from US states that remain too close to call.

US futures moved sharply lower after stocks ended Thursday in the green.

  • Dow futures fell 281 points, or 1%.
  • S&P 500 futures were down 1.2%.
  •  Nasdaq futures fell nearly 1.4%.

The US dollar was weaker as traders bet on more stimulus from the Federal Reserve in the absence of large-scale financial support from the government.

Stocks in Asia were mixed.

  • China's Shanghai Composite fell 0.2% on Friday.
  • Hong Kong's Hang Seng Index was little changed.
  • Japan's Nikkei was the region's best performer, rising 0.9%.

In Europe:

  • The FTSE 100 was down 0.7% in early trade in London.
  • Germany's DAX off by 1.5%.
  • France's CAC 40 down by 1.3%.

Where the vote stands this morning: Vote counts continue to roll in from six states that CNN has yet to call.

President Trump's lead has narrowed in the key state of Pennsylvania, and Joe Biden has taken a small lead in Georgia.

Trump's campaign has also launched a series of lawsuits in key battleground states.

Trump publicly addressed the close race for the White House on Thursday.

During his remarks, Trump baselessly claimed the presidency was being stolen from underneath him as vote counts showed his path to victory disappearing.

"The final outcome may be subject to the US courts but the market is taking its lead from what looks like a Democrat in the White House who presides over a divided government," Kerry Craig, global market strategist at JP Morgan Asset Management, wrote in a research note Friday.

He added that the state of the race "suggests that we are likely to see more compromise."

"The market has concluded that gridlock is a friendly outcome," said Stephen Innes, chief global markets strategist at Axi.

A divided government suggests less growth and stimulus, but also less tax and regulation, Innes wrote in a note to clients. 

Craig said markets' attention will soon turn to the rising number of Covid-19 cases in the United States, and the fiscal support that is needed to help Americans hit by the pandemic

Another 751,000 Americans claimed first-time jobless benefits last week, the Labor Department reported Thursday.

That's down slightly from the prior week, though it was a less encouraging report than economists had expected.

On Friday, the US Department of Labor is set to release the US jobs report for October.

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