BusinessNow: Live coverage of financial markets and companies, plus analysis and opinion

The market has just had its largest one-day gain in five years, on the back of Trump’s win.

Iron ore miners are surging after the commodity jumped 9.2 per cent in three days.

• Stocks surge back to life
• Deutsche predicts market slump
• BHP, Fortescue rip higher
• Stocks rocket on Trump’s win
• Trump could worsen ‘bondcano’
• Surfstitch feud takes nasty turn
• Trump winners and losers
• Is BHP about to surge 10pc?

Welcome to the BusinessNow blog for Thursday, November 10. The big iron ore miners are soaring after the key Australian commodity hit a two-year high overnight, while the local market has closed sharply higher.

8.43pm:Wellard hit by loss of key ally

Paul Garvey

Embattled livestock shipping company Wellard has lost one of its few remaining allies, with the group now at war with a key backer after a spat over its upcoming annual general meeting.

Butt Nominees, a company controlled by Pakistani businessman Tariq Butt and which holds a 14.4 per cent stake in Wellard, on Thursday revealed it would vote its stake against several resolutions at the Wellard AGM later this month.

Butt issued a statement slamming Wellard’s corporate governance, remuneration practices and share price performance after Wellard refused to release a shareholder letter from Butt through the Australian Stock Exchange.

“We never intended this to become a hostile situation but Wellard’s refusal to engage constructively with Butt Nominees and Wellard’s obvious corporate governance failings have left us with no choice,” Butt Nominees’ local director, Tyron Dennison, said in a statement. Read more.

7.58pm: Analysts divided on new ASX winners, losers

Chris Kohler

As investors frantically adjust to Donald Trump’s US election victory, equity strategists are divided on where the money will flow and how portfolios should be reshaped.

“In the near term, we expect the risk-off environment to be relatively positive for cash-generative companies,” Credit Suisse equity strategist Hasan Tevfik said.

His top picks in the Australian market include BHP Billiton, Boral and Vocus Communications but in the medium term he said investors should position for a more inflationary environment and be wary of “highly valued, highly leveraged bond proxies”. Read more.

7.49pm:European stocks extend gains

Europe’s main stock markets rose at the start of trading on Thursday, extending the previous session’s strong gains in the wake of Donald Trump’s shock US presidential victory.

London’s benchmark FTSE 100 index climbed 0.7 per cent to 6,962.64 points compared with Wednesday’s close.

Frankfurt’s DAX 30 won 0.6 per cent to 10,710.04 points and the Paris CAC 40 advanced 0.7 per cent to 4,577.01.

World stock markets have recovered from a sharp initial downturn to Trump’s win, with Europe’s leading indices closing up between 1.0 and 1.6 per cent on Wednesday. AFP

6.45pm:Big business doesn’t get it: Suncorp

Michael Bennet

Big business doesn’t “understand” politics and must do more to repair the “fraught” relationship with government, according to Suncorp chief financial officer Steve Johnston.

A day after Donald Trump’s shock US presidential win, Mr Johnston used a public speech to claim that the Coalition and Labor faced a “backlash from a cynical and anxious electorate” and politics in Australia had become “almost completely reactive”.

“Micro parties and individuals rise too easily on the celebrity factor, effectively harnessing community dissent to pursue narrow agendas with no requirement to detail a plan for the future,” he told a Trans-Tasman Business Circle event.

“Good public policy that is in the best interests of our nation, is being sacrificed for short-term vision — driven by populism like never before.”

But politicians weren’t entirely to blame, with Mr Johnston claiming business had also lost focus on its core responsibilities and weren’t immune from “short-termism” as they pandered to investors’ demands rather than make long term investments. Read more.

6.28pm:How a 12-hour market thrill ride unfolded

As Americans headed to the polls on Tuesday morning, local time, sales staff at Deutsche Bank’s London offices circulated a lighthearted message on their terminals to gauge the chances they’d be able to turn in early that night.

“If Clinton wins Florida, GO TO SLEEP. If she wins Georgia, definitely GO TO SLEEP,” the message said. If Donald Trump were to win Pennsylvania and Michigan, which the message described as “both leaning to Clinton,” then “GET READY FOR WORK.”

By early Wednesday morning US time, Mr Trump had captured at least three of the four states in route to a stunning presidential victory that shook the political establishment to its core and sent shock waves through global markets.

Over a 12-hour period, markets for stocks, bonds, currencies and commodities plunged before ricocheting back toward all-time highs. The roller coaster ride spawned winners, losers and more than a little heartburn in trading centers world-wide. And while Wednesday ended on a bullish note, the turbulence is likely to continue as the particulars of Mr Trump’s administration and agenda come into focus. Read more.

5.50pm: Tokyo stocks rally 6.72pc

Tokyo’s benchmark stock index closed 6.72 per cent higher on Thursday, led by a surge in financials and export giants, on hopes Donald Trump’s shock US presidential election win will provide a boost to the world’s number one economy.

The key Nikkei 225 index, which plummeted 5.4 per cent on Wednesday, jumped 1,092.88 points to 17,344.42. The broader Topix index of all first-section issues was up 5.78 per cent, or 75.19 points, at 1,376.35.

“It’s like yesterday never happened,” said Tsutomu Yamada, an analyst at Kabu.com Securities Co in Tokyo, told Bloomberg News.

“What was a Trump shock-reaction is now a Trump rally,” he said. Tokyo’s advance tracked a rally on Wall Street where pharmaceutical and banking shares soared on hopes that Trump’s defeat of Hillary Clinton would usher in favourable policies.

Among the big gainers were exporters as the yen tumbled against the dollar. The greenback bought 105.36 yen in Tokyo, down from 105.72 yen in New York but still sharply up from the 101.20 yen mark touched in Asia earlier on Wednesday.

The Tokyo market saw “too much selling yesterday although I believe that was a normal reaction” to the surprise result, said Toshihiko Matsuno, senior strategist at SMBC Friend Securities. AFP

5.48pm:Dollar’s recovery continues

The Australian dollar has recovered some of the falls incurred as Donald Trump won the US presidential election, as markets begin to speculate he could drive further improvement in the US economy.

At 5pm (AEDT) on Thursday, the local unit was trading at US76.74 cents, up from US76.19c on Wednesday.

Mr Trump highlighted plans to boost government spending in his election victory speech, and commodity prices have since risen, providing support for the Australian dollar.

Many expect Mr Trump’s spending will fuel inflation, a prospect that typically boosts bond yields, and as a result the price of Australian bonds took a sharp fall on Thursday, reversing Wednesday’s rise.

ANZ head of FX research Daniel Been said Mr Trump’s win will have a lasting and negative impact on the Australian dollar, but it will be some time before the market knows how closely the new president’s policies will resemble his election rhetoric.

“With the campaign over, this period of calm could persist in the near term,” Mr Been said. AFP

4.25pm:Stocks rally on Trump hopes

The Australian sharemarket gained almost $54 billion during trade today, rallying sharply from heavy losses yesterday as investors quickly looked ahead to what they see as pro-growth policies of US president-elect Donald Trump, writes Daniel Palmer.

At the close, the benchmark S&P/ASX 200 index shot up 172.2 points, or 3.34 per cent, to 5,328.8, while the broader All Ordinaries index leapt 170.6 points, or 3.26 per cent, to 5,408.9.

The positive action comes after $29bn was wiped from the exchange yesterday amid initial fear over what a Trump presidency might look like.

4.00pm:Who’ll be in Trump’s administration?

Donald Trump’s successful insurgent bid for the White House promised to up-end a global power structure that benefited large corporations.

Several Wall Street financiers and other successful business leaders could be in line to run top posts in Trump’s presidential administration.

Now, several Wall Street financiers and other successful business leaders could be in line to run top posts in his presidential administration.

People close to Mr Trump have said he is considering Steven Mnuchin, a former Goldman Sachs Group banker who became his national campaign finance chairman in May, as his pick for Treasury secretary. If tapped for the job, Mr Mnuchin would become the third Goldman alumnus in the last 20 years to head the Treasury, following Robert Rubin and Hank Paulson, who both served as the bank’s chief executive.

WSJ

Read more

3.36pm:Most profitable winemaker in the world?

Treasury Wine Estates chief executive Michael Clarke has unveiled an ambitious target to hit earnings margins as high as 30 per cent, making it the most profitable winemaker in the world.

Treasury Wine Estates has unveiled an ambitious target to hit earnings margins as high as 30 per cent

And he believes he can get there without the need to demerge its lower margin commercial wines portfolio.

The pledge should cool off speculation Treasury Wine Estates (TWE) is seeking to rid itself of its long tail of cheap wine brands in order to focus on its more lucrative luxury portfolio, such as Penfolds and Wolf Blass. If met, it will trigger a significant acceleration of the company’s earnings.

3.06pm:ASX eyes best day in 15 months

Banks and miners are seeing the local market hold onto strong gains today, with BHP Billiton, Rio Tinto and Macquarie standing out as they rip higher.

BHP and Rio are ripping higher after the iron ore price surged this week.

At 2:45pm AEDT the S&P/ASX 200 was 2.7 per cent higher at 5297 points as it steams towards it best day since August last year.

BHP Billiton has cooled from its morning high but remains 7.5 per cent in the black at $24.25 following a 9.2 per cent rise in the iron ore price in the past three days. Iron ore futures are also keeping investors happy as they point to another solid rise tonight.

Rio Tinto is 8 per cent higher for the day at $58.03 and Fortescue Metals is up 8.9 per cent for the day at $5.91.

It’s not all smiles in the resources space, however, with gold miners hating the sudden return of risk-on sentiment.

Gold miners quickly sank to the bottom of the pile today and are staying there, with Regis Resources, St Barbara, Evolution, Newcrest and Northern Star all giving up more than 3.7 per cent.

Macquarie is also a standout among the big players, with the financial heavyweight shooting 7.9 per cent higher today to $79.97 and looks set to notch up its best day since May 2013. But remember today’s rally comes on the back of a 4.3 per cent dive yesterday.

2.55pm:Zip Industries buys Vestal

Bridget Carter

In the months ahead of a sale or float on the Australian Securities Exchange, Zip Industries has purchased on-tap drinking water systems provider Vestal for a sum of around $10 million.

It comes as the group works with Gresham on its sale plans and prepares to appoint joint lead managers for a float in February if its adviser can’t find a buyer.

Zip has also signed an exclusive supply arrangement with Italian manufacturer Celli.

Chief executive of Zip, John Doumani, said the acquisition of Vestal would provide a significant new growth opportunity for the business.

“Vestal’s still and sparkling water offer is becoming increasingly popular with Hotels, Restaurants and Cafes,” said Mr Doumani.

“But the category remains underdeveloped with only an estimated 4 per cent of outlets using on tap drinking water systems.”

Zip’s hotels restaurants and cafes market is experiencing particularly strong demand for dispensed drinking water appliances driven by a strong commercial rationale including storage and fridge space, reduced bottle disposal costs and margin expansion on sparkling water sales, he said.

Vestal was established in Tasmania in 2008 with a vision for environmental, social and economic sustainability, eliminating the use of over 4 million single use water bottles each year.

2.23pm: Why today’s bounce is irrelevant

Stephen Bartholomeusz

The bounce-back in US stocks as markets adjusted to the reality of a Trump presidency was a rational short-term reaction. It’s the longer term implications for markets, economies and international relations once Trump actually takes office next year and starts to implement his radical suite of policies that will be of greater consequence.

There were two broad influences behind the big shift in sentiment that saw a major stockmarket fall signalled by the futures markets as a Trump victory became apparent turn into a solid rebound in the markets once physical trading got underway. Read more

1.50pm:ASX 200 up but watch bond yields

Australia’s S&P/ASX 200 is up 2.8 per cent at 5297 after hitting an intraday low of 5291.

The intraday pullback comes after a 3.1 per cent spike to 5318.7 peaked at midday and coincides with a slight reversal of overnight moves in US Treasuries and gold.

Another 50 basis points rise in bond yields will hit the yield stocks.

At this stage it looks like the S&P 500 will close above the 200-DMA at 5270. A close above the 200-DMA could keep the mood positive before the weekend.

Keep an eye on bond yields though. The surge above 2.30 per cent suggests the 10-year yield is going to 2.80 per cent.

Another 50 basis points rise in bond yields will hit yield stocks.

1.31pm:ASX winners and losers under Trump

Tim Boreham

So we won’t be seeing the inaugural First Bloke of the White House after all, with the Hillary and Bill show dispatched back to hometown Arkansas (where voters turned on them there as well).

Locally, it’s hard for bunny-in-the-headlight investors to know where to turn after the apocalyptic outcome, except to hope that president-elect Donald ducks on his more extreme isolationist and protectionist policies.

For our key stocks exposed to the land of the free — as long as you have a couple of hundred million to run a campaign — there are momentous but amorphous implications ahead of Trump assuming the iron throne in January.

Take Computershare (CPU, $10.23), which coincidentally held its annual general meeting on Wednesday.

Computershare derives just under half of its revenue from the US, including share registry, share solicitation in takeover situations and managing employee share schemes. Read more.

1.04pm:Tokyo stocks soar 6pc

Tokyo stocks soared six per cent in early Thursday after diving the previous day on Donald Trump’s shock win in the US presidential election, as global stocks and the dollar rallied.

The benchmark Nikkei 225 index, which had plummeted 5.4 per cent on Wednesday, shot up 6.0 percent, or 975.74 points, to 17,227.28 in early trade.

The broader Topix index of all first-section issues was up 4.78 per cent, or 62.17 points, at 1,363.33.

In forex trading, the dollar bounced back to 105.62 yen, sharply up from the 102-yen range seen when the Tokyo market closed with heavy losses on Wednesday.

Tokyo picked up a strong lead from Wall Street, where stocks surged following Trump’s upset win over Hillary Clinton, with pharmaceutical and banking shares especially strong in anticipation of favourable policies.

The Tokyo market saw “too much selling yesterday although I believe that was a normal reaction” to the surprise result, said Toshihiko Matsuno, senior strategist at SMBC Friend Securities.

He added that “no one had expected that much of rally” on Wall Street. “Those who sold shares yesterday are buying back as they watch Trump’s next steps,” he said, adding hopes were currently building up on fiscal-spending plans under the Trump administration. AFP

12.35pm:Stocks surge back to life

The Australian sharemarket has held onto gains of almost 3 per cent in early afternoon trade, surging back to life after a 1.8 per cent slide yesterday wiped $29 billion from the market, writes Daniel Palmer.

At 12.15pm (AEDT), the benchmark S&P/ASX 200 index bounced 147.1 points, or 2.85 per cent, to 5,303.7, while the broader All Ordinaries index leapt 149.2 points, or 2.85 per cent, to 5,387.5.

The rise has added $46 billion to the local benchmark.

Elsewhere in the region, Japan’s Nikkei 225 has rebounded 6 per cent after lagging its peers yesterday, while the Hong Kong and New Zealand markets have risen 2 per cent.

12.10pm:Deutsche predicts 5pc slump in stocks

Aussie investors can expect to see around a 5 per cent fall off the local index as a result of Trump winning the election, according to Deutsche Bank strategist Tim Baker, who notes a sell-off could have equities looking technically cheap.

Despite today’s healthy rally on global markets, US policy uncertainty will prove to be a headwind for stocks.

Despite today’s healthy rally on global markets, US policy uncertainty will prove to be a headwind for stocks, Deutsche says.

“Australia is already off 5 per cent from its recent peak — we’d see further downside contained at 5 per cent,” Mr Baker said, adding that “such a sell-off would take the [price to earnings ratio] to 14.5x — 10 per cent below our fair value model”.

“At spot commodity prices that’d be a [price to earnings] of 13.5x. That’s 15 per cent [cheaper than our model] — about where it traded when uncertainty was high in 2012.”

And while resources stocks are jumping for joy today, a potentially stronger greenback will weigh on the big players and keep gold miners looking attractive.

“The rise in risk aversion should boost the USD. A strong USD tends to weigh on commodity prices, which could affect resource stocks. But gold prices should be well supported given uncertainty.”

12.05pm:What crackdown on investor lending?

A supposed crackdown on investor lending is no longer showing up in official data on the housing market, with figures today revealing a 4.6 per cent surge in the value of loans offered to investors through September, writes Daniel Palmer.

The strong showing from investors comfortably outpaced the 0.9 per cent growth rate for owner-occupiers, leading to a seasonally adjusted overall rise in housing finance of 2.3 per cent to $32.3 billion in September, according to ABS data.

The jump in the value of investor loans to $12.42bn leaves the figure at a 15-month high having bounced almost 15 per cent off April’s low.

11.50am:Cover-More lifts on Buffett deal

Travel insurer Cover-More has seen its shares surge over 5 per cent after signing a heads of agreement for an underwriting deal with a Warren Buffett-controlled group, writes Daniel Palmer.

Berkshire Hathaway Specialty Insurance Company will serve as Cover-More’s primary underwriter in Australia and New Zealand.

The deal is expected to see Berkshire Hathaway Specialty Insurance Company (BHSI) serve as Cover-More’s primary underwriter in Australia and New Zealand.

BHSI is a subsidiary of Mr Buffett’s giant conglomerate Berkshire Hathaway, which provides a broad suite of insurance offerings worldwide.

Read more

11.40am:ASX hits resistance at yesterday’s high

Australia’s S&P/ASX 200 rally is starting to fade, with the index up 2.8 per cent at 5301 after earlier surging 3.2 per cent to 5317.50.

The rally in local shares is starting to fade.

The intraday high is just a few points above yesterday’s peak at 5314.10, so it hasn’t really broken.

And it remains to be seen if we will close above the 200-DMA at 5270.

Despite the bounce from yesterday’s lows, global markets could hardly be described as “risk on”.

Even the “inflation-on” reaction isn’t universal, as gold is down while bond yields are up.

Aussie share traders probably need to allow for a retest of major chart support from yesterday’s low at 5050.

That’s the Brexit low and the 61.8 per cent Fibonacci retracement of the February to August rally.

11.28am:Treasury Wine on path to growth: CEO

Treasury Wine Estates chief executive Michael Clarke has pledged to investors that the world’s largest publicly listed winemaker is on a pathway to growth, and would hit its target of high-teens pre-tax earnings by 2018, writes Eli Greenblat.

The winemaker is on track to meet earnings guidance two years early.

Addressing shareholders today in Adelaide at the company’s annual general meeting, the winemaker, whose brands include Penfolds, Wolf Blass, Blossom Hill and Lindeman’s, has also promised to deliver “balance, sustainability and quality’’ to its earnings base.

Mr Clarke told investors that momentum from all its regions and a strong performance from its “priority brand portfolio’’, which generated more than 85 per cent of sales revenue in fiscal 2016 and in excess of 90 per cent of pre-tax earnings, would set Treasury Wine Estates on course to meet earnings guidance two years early.

11.11am:Optus earnings dented by content strategy

Singtel Optus’s pursuit of premium sports content has helped it add more postpaid mobile customers but the extra spend coupled with the continued reduction in mobile termination rates has seriously dented the telco’s earnings, writes Supratim Adhikari.

The telco posted EBITDA of $633 million for the quarter ending September 30, a 10.3 per cent decline from the $706m in the same period last year.

Net profit for the quarter was $184m, down 20 per cent from the same period last year. The telco said that it expects mobile service revenue to decline by mid-teens for the financial year ending 31 March 2017.

More to come

11.00am:BHP, Fortescue rip higher

BHP Billiton rocketed as much as 9.8 per cent higher this morning, while Fortescue ripped to its highest level since February 2014 following a monster bounce in the iron ore price.

The steel-making commodity has now lifted 9.2 per cent in three days and sits just below $US71 a tonne — its highest level since January last year — and local iron ore stocks are surging as a result.

Iron ore is sitting just below $US71 a tonne and mining stocks are surging as a result.

At just before 10:30am AEDT the S&P/ASX 200 was 2.9 per cent higher for the day at 5305 points, with banks and miners boosting the index following yesterday’s wild session.

Fortescue was 11 per cent higher for the day after initially shooting up 12.5 per cent to a $6.11, its best position since February 2014.

The pure-play iron ore miner has now gained around 230 per cent for the year — leaving analysts with their mouths wide open — to be the second-best performing stock of the year behind Whitehaven Coal.

Meanwhile BHP, which is the second-largest company on the ASX by market capitalisation, was a whopping 8.6 per cent higher after seeing an almost 10 per cent rise early. The stock hit its highest level since October 2015 at $24.78.

But where there’s broad market relief and surging risk assets, there are sad gold miners.

Aussie gold stocks were among the worst performers today, with Newcrest, Resolute, Regis, Evolution and St Barbara all dropping more than 6.7 per cent.

10.35am:Miners shoot the lights out

Investors are buying into the market with vigour, with the iron ore miners the leading lights after the key Australian export traded near a two-year high overnight, writes Daniel Palmer.

Iron ore miners are leading the market higher after the key Australian export hit a two-year high.

Fortescue soared 12 per cent to a two-and-a-half-year peak of $6.08, BHP surged 9.3 per cent to a 14-month high of $24.66 and Rio Tinto leapt 9 per cent to an 18-month peak of $58.58.

Gold miners went in the opposite direction as the safe haven trade quickly lost favour and the precious metal saw yesterday’s gains wiped.

Read more

10.25am:Stocks rocket on Trump’s win

The Australian sharemarket has surged back 3 per cent after yesterday’s $29 billion sell-off, aided by a sharp turnaround in sentiment through US trade in the wake of Donald Trump’s election victory, writes Daniel Palmer.

Investors have taken the prospect of reduced banking regulation, greater infrastructure spending and lower-for-longer rates as reasons to buy.

Investors had long fretted about a Trump presidency and all the uncertainty it threatens, but despite the shock result investors have taken the prospect of reduced banking regulation, greater infrastructure spending and lower-for-longer rates as reasons to buy.

At the 10.15am (AEDT) official market open, the benchmark S&P/ASX 200 index jumped 156 points, or 3.03 per cent, to 5,312.6, while the broader All Ordinaries index bounded 155 points, or 2.96 per cent, to 5,393.3.

Read more

10.13am:Trump could worsen the ‘bondcano’

Donald Trump could accelerate the end of the ASX yield trade and put more pressure on several formerly favoured big-name companies such as Transurban, Sydney Airport and Westfield, Credit Suisse says.

“Global inflation is set to rise if Trump can implement his policies and this is yet another headwind for the three-decade bond bull market,” Credit Suisse equities strategist Hasan Tevfik says.

Global inflation is set to rise if Trump can implement his policies, Credit Suisse says.

“Aussie investors should continue to beware of the Bondcano, but a Trump presidency will have mixed implications for Aussie companies with US exposure.”

In the US, his firm expects a short-term negative hit to business confidence, a medium-term boost from fiscal policy and possibly a long-term negative effect from debt constraints.

The chance of a Fed rate hike in December has declined but remains above 50 per cent, according to Credit Suisse, with the biggest changes concerning foreign policy.

“For now, markets are seeing the glass as half-full and focused instead on the possibility of fiscal easing, tax reform and other pro-growth policies,” Tevfik says.

“This has resulted in a jump in US Treasury yields and a steepening yield curve. In this context, the Aussie dollar will be caught in a tug-of-war between a rise in policy uncertainty and pro-growth US policies under Trump.”

“Global sectors to benefit from a Trump presidency include defence, building materials/engineering companies, pharmaceuticals, banks and fossil fuel related companies.

“Near-term uncertainty could mean global equities fall sharply and in the past these falls have been in the range of 5-10 per cent for the S&P 500, Mr Tevfik said.

Aussie stocks

“In the near term we expect the risk-off environment (if it actually does materialise — we too are surprised with last night’s moves) to be relatively positive for cash-generative companies. The latest ‘Diamonds in the Dust’ screen includes BHP Billiton, Boral and Vocus Communication,” Mr Tevfik said.

BHP is among the companies Credit Suisse believes could fare well in the current environment.

“In the medium term we believe investors should position for a more inflationary environment and be cautious on highly valued, highly leveraged bond proxies. Stocks at the top of The Bondcano continue to be infrastructure, regulated utilities and the REITs. Stocks at the bottom include the miners. Commodity companies remain our main Overweight.”

10.05am:Surfstitch feud takes a nasty turn

The bitter feud between Surfstitch and suitor Crown Financial continues to escalate, with the former using an update to shareholders to criticise the actions of Crown Financial in its bid to secure control of the company, writes Daniel Palmer.

The bitter feud between Surfstitch and suitor Crown Financial continues to escalate.

It comes as corporate regulator ASIC is drawn into the stoush, although its interest appears to be in the separate legal battle over disputed licensing deals between the two companies rather than the takeover deliberations.

The embattled ASX-listed Surfstitch, an online surfwear retailer, rejected a $55 million offer made by Crown Financial subsidiary Coastalwatch earlier this month citing both the low valuation and the ongoing legal scrap between the two companies as key reasons for the rejection.

More to come

9.56am:Wall Street’s Trump winners and losers

Donald Trump’s upset victory over Hillary Clinton caught many investors off guard. While it didn’t cause a broad market decline as many had feared, it did send some stocks sharply higher and others sharply lower.

Investors are trying to anticipate how Trump’s campaign trail talk might translate into policies that affect US companies.

Here’s how some industries shook out as investors try to anticipate how Trump’s campaign trail talk might translate into policies that affect US companies.

Winners:

Drugmakers

Pharmaceutical companies and pharmacy benefits managers rose sharply on expectation that Trump and a Republican-controlled congress are less likely to crack down on rising drug prices. Pfizer jumped 7 per cent, Celgene rose 9 per cent and Express Scripts gained 7 per cent.

Defence contractors and infrastructure companies

Hopes that Trump will spend more on defence and follow through on campaign promises to boost spending on infrastructure benefited several companies. Raytheon jumped 7 per cent and so did heavy machinery maker Caterpillar.

Private prison operators

Hillary Clinton had said she wanted states to stop using privately operated prisons. That threat is now diminished. Corrections Corporation of American jumped 50 per cent, and Geo Group rose 21 per cent.

Losers:

Gun companies

With his endorsement from the National Rifle Association, Trump is seen as far less likely to push for stricter gun control measures than Clinton would have. That means investors are no longer expecting a rush of gun sales due to nervous customers looking to stay ahead of government restrictions. Smith & Wesson dropped 15 per cent and Sturm, Ruger & Co. plunged 14 per cent.

Hospital chains and certain insurers

Companies that benefited from President Obama’s health care legislation, the Affordable Care Act, took heavy losses. Trump has said he would repeal the law. The nation’s largest hospital chain, HCA Inc., plunged 15 per cent, and Community Health Systems plunged 29 per cent.

Clean energy

Trump has advocated for lighter regulation of oil and coal companies, which could hamper demand for clean energy alternatives, such as solar and wind power. SunPower Corp. sank 15 per cent.

AP (Linda Johnson, Tom Murphy and Seth Sutel)

9.45am:Five forces unleashed by Trump

Whether it be London, New York or Canberra-Melbourne-Sydney, the political, public service and media elites have their own agendas and tend to ridicule those with different ones, writes Robert Gottliebsen.

Trump and Sanders understood that the way the political/media elite think and communicate is totally different to the way large slabs of the mainstream population think.

Sanders’ solutions were very different to Trump’s, but both were addressing similar issues. And we saw many of those same forces unleashed in Britain’s Brexit vote.

Let me isolate five of the forces Trump has unleashed and then look at the market dangers. Where appropriate I will isolate an Australian equivalent.

Read more

9.33am:Buy the dip or sit on the sidelines?

Australian investors look ready to follow Wall Street’s example and throw caution to the wind as Donald Trump’s win filters into every corner of the market, but analysts are still playing catch up.

The S&P/ASX 200 is today tipped to follow Wall Street’s unexpected rally with a 3.3 per cent rise.

The S&P/ASX 200 is heading for a 3.3 per cent rise today, according to SPI futures fair value, with BHP Billiton preparing for a 10 per cent jump and CBA ready to rise 3.5 per cent. But this response was definitely not expected by all.

Last night Morgan Stanley equity strategists led by Adam Parker said they would not be buying yesterday’s election dip.

“Every client overnight asked us the same question — ‘should I buy the dip?’ with the futures hitting temporary shutdown circuit breakers as we are typing this around midnight New York time,” Morgan Stanley said.

“We’d love to say yes, as we have been avid dip buyers over the past few years. But, our gut instinct is no. We are more bearish today than we were yesterday because of increased uncertainty.

“There is no way around that impacting the price-to-earnings ratio in the short-term, and perhaps until after Trump’s inauguration at a minimum. It is just too difficult to predict what will happen in the first 100 days in a new administration, or frankly, what will happen before then.”

While Morgan Stanley may miss today’s burst of positivity following the end of a long and brutal election campaign, they recommend adjusting portfolios to adapt to Trump’s policies.

The analysts recommend owning industrials, healthcare stocks and being “close to neutral on banks in the short term”.

9.27am:What the hell happens now?

It’s one thing for Donald Trump to be president, but quite another to think what sort of people put him there and what sort of mood they are in, leaving much of America and Western democracy in a state of near despair, writes John Durie.

Trump steps into the White House with Republican control of the Senate and the House, which on paper gives him an armchair ride to do what he wishes.

No one can ignore the movement that took hold with Britain’s Brexit vote in June and was extraordinarily rammed home with the Trump victory, which in many respects leaves US society in a state of crisis.

Mainstream political parties and elite groups like big ­business have some fundamental questions to ask about their next moves because this was no ­aberration.

Read more

9.15am:Leaked Rio emails show CEO’s unease

Rio Tinto’s then chief executive Tom Albanese told his iron ore boss Sam Walsh in 2011 that he was concerned about “the optics” of a $US10.5 million payment to a Guinean adviser close to president Alpha Conde in 2011 that has now resulted in the suspension of senior Rio executives Alan Davies and Debra Valentine, writes Matt Chambers.

The email was sent after Rio had agreed to pay Guinea a $US700m settlement fee to retain Simandou iron ore project mining tenements.

In the 2011 email chain obtained by The Australian, Mr Davies, then head of international iron ore operations, asks Mr Walsh for permission to pay consultant Francois de Combret $US10.5m, down from a fee of $US15m.

“Sam, I accept that this is a lot of money, but I also put forward that the result we achieved was significantly improved by Francois’ contribution and his very unique and unreplaceable services and closeness to the President,” Mr Davies said in the May 10, 2011 email.

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8.45am:Is BHP about to surge 10pc?

BHP shares could explode 10 per cent today as investors look to dive into the world’s biggest miner following a huge rally in the price of iron ore and a broad relief rally on global markets as the US election is finally over.

Today could be the best day for BHP shares since 2008.

The miner’s ADRs are showing a 10 per cent premium to the last Sydney close of $22.56, while the broader ASX 200 is heading for a 3.3 per cent rise, according to SPI futures fair value.

The price of iron ore delivered to the port of Qingdao rocketed to 3.9 per cent an almost two-year high of $US70.98.

The key Australian export commodity has now surged 9.2 per cent in three days.

If BHP manages to gain the 10 per cent it’ll be the best for the stock day since November 2008.

BHP to open 10% higher...CBA 3.5%...Not great if you in quasi-bond stocks (REITS, STAPLES, UTILIITES or gold)..but everything else flying

— Chris Weston (@ChrisWeston_IG) November 9, 2016

8.38am:Trump could boost banks, healthcare: UBS

US banks and energy stocks could benefit from the surprise election victory of Donald Trump, while the health of the real economy in the US is set to outweigh political uncertainty, UBS said in a note to clients.

National defence companies could also benefit from the Trump win.

“Selected industries could benefit from the possibility of more lenient regulation — particularly the financial services and energy sectors,” UBS’s global chief investment officer Mark Haefele.

“Other businesses, especially those focused on national defence infrastructure, could enjoy advantages from more expansionary fiscal policy.”

UBS expects corporate earnings per share to rise from a lacklustre 1 per cent this year, after several quarters of a much-discussed earnings recession, to a healthier 8 per cent next year.

“US stocks can rebound on the back of accelerating earnings per share growth,” UBS said.

“Still, policy uncertainty may raise overall equity-market volatility, and lead to market dislocations that short-term investors might look to exploit.”

UBS said markets will look to Mr Trump’s appointments to key administrative positions for clues about his policy agenda, “given [his] limited background in politics”.

8.17am:Goldman names Sims as partner

Goldman Sachs has named Melbourne-based head of Australian mergers and acquisitions, Nick Sims, as Partner.

Australia’s Nick Sims joins about 350 partners in a workforce of around 35,000.

The appointment allows Mr Sims to be part of an exclusive bonus pool offered to a select group of its chosen bankers around the globe.

There are at least 50 Goldman’s managing directors in Australia and those already with partnership status are Australian chief executive Simon Rothery, head of investment banking Christian Johnston, head of natural resources Richard Phillips and Philip Moffat, who heads up Australia’s asset management division.

Senior banker Anthony Miller, who previously worked in the Australian team and is now based in Hong Kong is also a partner, as is the former Australian head of equities Andrew Rennie.

In 2014, there were about 78 people who were offered the status internationally.

Globally, Goldman Sachs has about 350 people who are partners among a workforce of about 35,000.

7.50am:NZ cuts rates amid volatility

The Reserve Bank of New Zealand has lowered interest rates, becoming the first central bank to respond to heightened global market volatility in the wake of Donald Trump’s unexpected US election win.

RBNZ Governor Graeme Wheeler made it clear he is worried about market instability and US political upheavals, saying they could trigger further rate cuts.

Dow Jones

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7.20am:ASX set to open sharply stronger

The Australian market looks set to open sharply higher after world markets rebounded from the shock election of Donald Trump as the next US president, which yesterday wiped $30bn off local stocks.

At 6.45am (AEDT), the share price index was up 167 points, or 3.24 per cent, at 5,317.

Yesterday the local market plunged, as did major markets around the world, as it became clear Mr Trump would win the race for the White House.

But overnight global markets regained their poise, with European and US stocks rallying as investors were reassured there would be a smooth transfer of power.

Locally, in economic news, the Australian Bureau of Statistics releases September housing finance figures.

In equities news, Westfield Corporation is expected to give a third-quarter update while SingTel Optus is slated to release second quarter results. Meanwhile, Wesfarmers, BlueScope Steel and Treasury Wine Estates have their annual general meetings.

In Australia, the market yesterday hit a four-month amid the global shock low following businessman and reality TV star Trump’s election.

The benchmark S & P/ASX200 index closed down 101.2 points, or 1.92 per cent, to 5,156.6 points. The All Ordinaries was 103.9 points, or 1.94 per cent, lower at 5,238.3 points at the close of trade.

AAP

7.10am:Big miners soar

The iron ore price has soared to its highest level in close to two years as a speculation-fuelled rally continues to put a rocket under Australia’s largest miners, Elizabeth Redman writes.

Iron ore added 4.7 per cent to $US71.00 a tonne overnight, according to The Steel Index, from $US67.80 the previous day.

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7.05am:Dollar regains lost ground

The Australian dollar has recovered a little ground against the US dollar following the shock election of Republican Donald Trump as the 45th US president.

At 6.35am (AEDT), the local unit was trading at US76.40 cents, up from US76.19 cents yesterday.

The local currency has also rebounded against the yen, the euro and the pound sterling.

AAP

7.00am:Trump a wake-up call: Nasdaq

The Nasdaq stock market’s chief executive said Donald Trump’s election triumph revealed the business world’s failure to sell the benefits of trade and globalisation.

But Bob Greifeld also downplayed the impact on US democracy and on his own company from Trump’s stunning march to the White House.

AFP

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6.55am:European banks face Trump woes

European banks already tormented by low interest rates and economic uncertainty face new anxieties from US president-elect Donald Trump’s surprise victory, analysts say, such as potential hits to their profits from trade financing and investment banking.

Dow Jones

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6.50am:Fed could hold after Trump

Donald Trump’s electoral victory, by roiling global financial markets and creating political uncertainty, could up-end Federal Reserve officials’ plans for raising short-term interest rates at their meeting next month.

Dow Jones

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6.45am:Wall recovers after sell-off

US stocks rallied in afternoon trade, the latest twist in a US presidential election that sent global markets into a tailspin overnight.

The Dow Jones Industrial Average soared 200 points and the 10-year Treasury yield rose above 2 per cent after Donald Trump’s surprise victory, which overnight had sent US stock futures sliding as much as 5 per cent and havens like the Japanese yen soaring.

Dow Jones

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6.40am:Trump slump turns to rally

World stock markets recovered from a sharp initial downturn to Republican Donald Trump’s shock election win, quickly regaining their poise with surprising resilience.

Asia kicked off a “Trump slump”, with Tokyo diving on concerns over the untested policies of the billionaire businessman and reality TV star.

Donald Trump declares victory

Europe followed suit, tipping about two per cent lower at the open, but later rallied as nerves were calmed by Trump’s conciliatory victory speech and a firmer Wall Street.

At the end of the European day, London stood 1.0 per cent higher, Frankfurt added 1.6 per cent and Paris 1.5 per cent — confounding forecasters.

“The much-feared election of Donald Trump didn’t cause the one-way negative reaction in markets many expected,” CMC Markets analyst Jasper Lawler said.

AFP