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EMERGING MARKETS-Mexican peso, Asian currencies slide as U.S. election tightens

Published 11/04/2020, 04:05 PM
Updated 11/04/2020, 04:11 PM
© Reuters.
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* Mexican peso, Chinese yuan slump on trade fears
* Russian rouble takes heart from Trump gains
* Asian shares gain as U.S. stock futures rise
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh
* Graphic: Foreign flows into Asian stocks https://tmsnrt.rs/3lKhL5I

By Shriya Ramakrishnan
Nov 4 (Reuters) - Mexico's peso and the Asian currencies
seen as most vulnerable to four more years of a Donald Trump
White House fell on Wednesday, while the Russian rouble gained,
as the latest voting tallies quashed bets of a clear victory for
Democrat Joe Biden.
Both Trump and Biden claimed they were on course for victory
after results for a majority of states were called, with Trump
ahead in several mid-West swing states where final counts may
take days to emerge. The peso MXN= suffered in the first years of Trump's
presidency and Biden's lead in polls in the run-up to Tuesday's
voting had seen investors price in an easing of border tensions
and influx of direct investment under a new administration.
The currency sank as much as 4% in overnight trade before
regaining some ground.
Moves in China's tightly-controlled yuan CNY=CFXS were
more limited, but still showed a 0.4% loss as investors shifted
to expecting another four years of rising trade tariffs and
tensions between Washington and Beijing.
The South Korean won KRW=KFTC and Singapore dollar SGD=
tracked that move, weakening 0.3% and 0.4% each. The rouble, by
contrast, gained around 0.2% in initial trade before flattening
out. RUB=
"FX markets had ... priced for a clean Biden win," said
Chris Turner, Global Head Of Markets with Dutch bank ING in
London.
"Instead, early news that Republicans had performed well in
Florida and that exit polls pointed to a much closer race than
had been expected have warned of a return of the Red Wave."


Broad gains for the dollar amplified the move against
emerging markets seen as most exposed to trade and investment
issues, with South Africa's rand also under pressure. ZAR=
Stock markets in Asia, however, held up, tracking gains in
U.S. futures that reflected the relative comfort of Wall Street
with the idea of Republicans holding onto the Senate and the
White House.
Both Turkish .XU100 and South African stocks .JTOPI
gained solidly in early trade.
While Trump is widely seen by investors as having mishandled
the coronavirus crisis, his administration has also stoked a
decade-long rally in equities by cutting taxes on big
corporations and, until the last six months, keeping the jobs
market humming.
The Philippine index .PSI topped gains in Asia, rising
about 2% to mark its biggest intraday percentage jump in more
than a week, with support from data that showed the country
posted its first monthly rise in exports since February.
"Today's market movement seems to be pricing in a Trump
victory, which the market seems to interpret as a continuation
of the past four years' economic policies," said Manishi
Raychaudhuri, head of APAC equity research at BNP Paribas.
"It's the Senate election outcome which may be more
important – and that also seems to be going in favour of
Republicans for now."

Highlights:
** Thailand's 3-year benchmark yield is up 4 basis points at
0.65%.
** Top gainers on FTSE Bursa Malaysia Kl Index .KLSE
include MISC Bhd MISC.KL up 2.74% at 6.76 ringgit, Sime Darby
Bhd SIME.KL up 2.55% at 2.41 ringgit, PETRONAS Chemicals Group
Bhd PCGB.KL up ​ 1.69% at 6.02 ringgit.
** In the Philippines, top index gainers are Bloomberry
Resorts Corp BLOOM.PS , up 7.05% at 7.9 peso; Jollibee Foods
Corp JFC.PS , up 6.02% at 185 peso, and Alliance Global Group
Inc AGI.PS , up 5.41% at 8.18 peso.

Asia stock indexes and
currencies at 0656 GMT
COUNTRY FX RIC FX FX INDEX STOCK STOCKS
DAILY YTD % S YTD %
% DAILY
%
Japan JPY= -0.43 +3.53 .N225 1.72 0.16
China .SSEC 0.23 7.49
>
India INR=IN -0.37 -4.42 .NSEI 0.85 -2.09
Indonesi IDR= +0.34 -4.41 .JKSE -0.54 -18.54
a
Malaysia MYR= -0.20 -1.77 .KLSE 0.56 -7.50
Philippi PHP= -0.11 +4.71 .PSI 2.03 -17.29
nes
S.Korea .KS11 0.60 7.26
>
Singapor SGD= -0.40 -1.52 .STI 0.73 -21.95
e
Taiwan TWD=TP +0.98 +5.12 .TWII 1.04 7.26
Thailand THB=TH -0.32 -3.95 .SETI 0.12 -22.60



<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
USD, MX peso, Chinese yuan on election night https://tmsnrt.rs/2I4KWkd
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