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Volatility dominates global markets with US election far from decided

4 Nov 2020 12:34 PM
Global markets have witnessed a state of uncertainty and strong fluctuations after the US election failed to produce a quick and decisive result. The tight gap between Joe Biden and President Trump threatens a lengthy counting process that may end being decided in the courts.

These fluctuations come after investors' appetite for stocks increased late on Tuesday after Biden initially led, but then Trump narrowed the gap and the possibility of mail-in votes deciding the result, which may take days, caused violent fluctuations in the markets.

Gold fell in early trading today, falling in immediate trading by 0.6% to $1896 an ounce, while futures contracts fell by 0.7% to levels of $1897 an ounce.

It is noteworthy that gold has risen by 25% so far this year as unprecedented global stimulus measures to meet the challenge of the pandemic have driven traders to seek gold as a hedge against potential inflation rises.

With voting over in several US states at the time of writing, Joe Biden has won 238 votes so far, while Trump has 213. The battle is still raging, however - especially in the remaining states where early results indicate Trump has won.

Oil has witnessed a decline on this morning’s high uncertainty. West Texas crude fell by 0.4% to $37.50 a barrel, while Brent crude fell 0.2% to $39.60 a barrel.

Oil has fallen by more than 10% over the last week as many countries restored lockdown measures to control the spread of Covid-19.

Oil stocks also declined strongly last week, falling by 8 million barrels to 487 million according to data released by API.

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