Markets extend rally following Trump shock

Markets have headed higher again as investors brushed aside their initial shock at Donald Trump's unexpected US election victory.

London's FTSE 100 Index climbed 0.8% in early trading, following a rally in Asian stocks overnight as they recouped steep losses seen in the previous session. European markets saw similar upturns.

Japan's Nikkei, which had fallen 5% the day before, climbed nearly 7%. In Hong Kong, the Hang Seng added 2%.

A turbulent start to the session on Wednesday had seen European markets briefly follow Asian shares into the red, with the FTSE 100 seeing a 2% fall during the first few moments of trading.

But London's leading share index quickly bounced back and ended the day 1% higher.

On Wall Street, the S&P 500 was also up 1% on Wednesday.

Image Caption: Traders on the floor of the New York stock exchange after Donald Trump's US election victory

The US dollar has rebounded too, helped by expectations that the US Federal Reserve was still likely to raise interest rates after all.

That possibility had looked sharply reduced in the immediate aftermath of Mr Trump's victory.

Markets had been nervous about the prospect of a Trump presidency up-ending the global political order and tearing up long-standing trade arrangements.

Video: Markets rally but Mexico's peso is battered

But sentiment calmed after his acceptance speech which eschewed some of the more confrontational rhetoric deployed during the campaign.

Instead he put the emphasis on reuniting a divided America, putting millions into work through large-scale infrastructure projects and dealing fairly with other countries.

Video: Markets look for 'glass half full'

Jasper Lawler, market analyst at CMC Markets, said: "In just a matter of hours, markets have switched from the election victory as a glass half empty to a glass half full.

"The perceived negatives of a Trump victory of protectionist trade policy and his anti-Federal Reserve rants have been put aside in hopes he will run a pro-business administration supported by tax cuts and fiscal spending."

:: Watch every twist and turn of the US election fallout live on Sky News.

Read more:
:: Donald Trump wins: US election results in full
:: Nasty campaign to give way to civilised handover
:: Brand Trump: Conflict of interest for tycoon
:: President Trump: What could possibly go wrong?
:: Sky Views: Trump a threat to global free trade

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