November 8 at 10:07 PM

How global markets reacted to Trump’s early lead

Republican presidential candidate Donald Trump gives a thumbs-up during a campaign stop, Saturday, Jan. 16, 2016, in Portsmouth, N.H. (AP Photo/Matt Rourke)

Republican presidential candidate Donald Trump gives a thumbs-up during a campaign stop, Saturday, Jan. 16, 2016, in Portsmouth, N.H. (AP Photo/Matt Rourke)

World financial markets fell steeply as Republican presidential candidate Donald Trump’s lead widened on election night. (Jenny Starrs/The Washington Post)

Global financial markets convulsed Tuesday night as Donald Trump was projected to claim victory in the race for the White House after a polarizing campaign that investors had largely bet against.

On Wall Street, all three major stock indices were down 4 percent or more late Tuesday evening in pre-market trading, with futures for the Dow Jones industrial average sliding more than 700 points at one point before paring those losses in the minutes before the results were clear. Futures trading was temporarily halted for the Standard & Poor’s 500-stock index amid a 5 percent loss.

The Mexican peso — which has fallen as the Republican nominee rose in the polls during his campaign — nosedived to an eight-year low, according to Bloomberg. The panic stretched all the way to Asia, where Japan’s Nikkei index plunged more than 900 points, or 5.4 percent, early Wednesday morning. In a flight to safety, gold charged higher. U.S. Treasuries and the yen also surged.

The assumption that Democratic nominee Hillary Clinton would notch a comfortable victory had boosted markets earlier in the week. But on Tuesday night, investors began to grapple with the possibility that Trump’s controversial proposals to rip up long-standing trade agreements, deport millions of immigrants and radically re-engineer the tax code could become reality.

“It’s all a little bit crazy now,” said Chris Weston, chief markets strategist at IG Markets in Melbourne. “Pollsters need to go away and have a holiday – every single one of them should be fired. Markets weren’t prepared for this.”

read more at: https://www.washingtonpost.com/news/wonk/wp/2016/11/08/markets-plunge-worldwide-as-trump-shows-surprising-strength/?hpid=hp_hp-bignews3_markets-1015pm%3Ahomepage%2Fstory