Here's a snapshot of what the business world thinks will happen if Trump wins
Markets-favourite Clinton is tipped to triumph, but investors are still spooked by The Donald.
INVESTORS ARE NERVOUS this US election day as the markets consider the possibility of a Trump presidency.
The Democratic candidate, Hillary Clinton, is considered a safer bet by many business people than Republican Donald Trump, who is seen as a loose cannon with policies many fear could wreck the world’s top economy.
Opinion polls suggest Clinton has a slight edge over her opponent, but the markets are still uneasy.
The maverick tycoon Trump rallied from a double-digit deficit in some polls to within striking distance of Clinton, and analysts highlighted looking at the election have drawn comparisons to Britain’s shock vote to leave the EU earlier this year.
Andy McLevey, head of dealing at stockbroker Interactive Investor, said: “Having had their fingers burnt in the aftermath of the UK EU referendum, it is of little surprise many have paused for breath, as despite polls signalling a Hillary Clinton victory seems likely, it is still too close to call and we may see some jitters as the day progresses.”
As investors keep a cautious eye on the result of today’s vote, which should be known by about 3am Irish time, here’s a snapshot of what some in the business community think might happen if Trump wins.
Market reaction
Alongside Brexit, this year’s unconventional US election is seen as the biggest risk to the global economy so markets are expected to experience big moves when the final result is known.
Today, Europe’s main stock markets wobbled as voting began. Frankfurt stocks edged higher, London teetered lower, while Paris flatlined.
Deutsche Bank analysts have predicted that European stock markets could dip by as much as 10% if Trump becomes president, but expect a Clinton victory to bring an increase by up to 5%.
Currency
While analysts reckon a Clinton victory could give the US dollar a much-needed boost, it’s less clear what a win for The Donald would mean for currency traders.
The Financial Times said the dollar could suffer against the euro and the yen “if investors’ instant reaction is a retreat from risk”.
Pundits have also warned that the Mexican peso could suffer badly if Trump wins considering his anti-Mexican rhetoric that has included a pledge to remove undocumented immigrants, build a border wall and tear up a trade deal.
Travel sector
A victory for Trump presents the worse of the two scenarios for the US travel and tourism industry, according to researchers at Euromonitor.
His anti-Muslim and anti-Mexican policies in particular would likely have negative consequences for the sector.
The market research firm wrote in a briefing note that a travel ban on all Muslims to the US would cost up to $71 billion per year.
Trump’s proposed mass deportations and the construction of a Mexican border wall “would likely hurt perceptions of the US as a destination for Mexican travellers and vice versa”.
Mexico is the number one foreign destination for US travellers while it is the second biggest source for travellers coming into America, second to Canada.
Travel companies like Airbnb, which says three of its top 10 cities in Latin America are in Mexico, and Expedia, would be among those negatively affected, according to Euromonitor.
With reporting by AFP.
