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Briefing highlights

  • Clinton or Trump? A market election guide
  • Potential impact depending on who wins
  • What could happen with a hung jury
  • Markets rally on latest FBI announcement
  • Canada in the eye of the storm
  • Market election guide

    This could be the week from hell across global financial markets if Donald Trump wins the U.S. presidential race or the election results in a hung jury.

    Both are distinct possibilities, based on recent polls. And, anyway, polls can be wrong, as investors learned only too well from the Brexit referendum.

    Markets don’t like uncertainty, and this week is chock full of it. Already, the S&P 500 has racked up nine straight trading days of losses.

    “Political uncertainty certainly rose back to the fore [last] week, with the national polls tightening and some key swing states returning to ‘toss-up’ status,” said BMO Nesbitt Burns senior economist Robert Kavcic.

    “After getting all but ruled out after the third debate, the market is now pricing in more than one-third (and trending up) odds of Trump winning the White House,” he added.

    “For a little perspective, that’s about three times more likely than an evenly matched team overcoming a 3-1 series deficit – buckle up.”

    So far, as we kick off a new week one day before what will be a historic election under any scenario, markets are rallying on the latest developments.

    Here’s something of a guide:

    Potential impact

    Observers believe a Trump victory would immediately roil financial markets, knocking down stocks and certain currencies, the Canadian dollar among them.

    What could follow that is a question mark.

    “The consensus is that a victory for Donald Trump ... would deal a lasting blow to the U.S. stock market,” said John Higgins, chief markets economist at Capital Economics.

    “Our sense, though, is that the performance of the S&P 500 would be a bit like that of the FTSE 100 in the wake of the U.K.’s vote for Brexit – after a lurch to the downside, a weaker currency and a lack of radical policy changes in practice would fuel a recovery.”

    That’s the longer term. Watch out for Wednesday m

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