Some investors said that a win by Clinton would calm markets, with traders largely preferring the Democratic nominee because of her perceived predictability on economic policies. That said, most of the gains from an expected Clinton win were priced in Monday.
“I think we have seen all of the upsides from Sunday’s news,” said Alex Furber, a sales trader at CMC Markets, referring to the decision by the Federal Bureau of Investigation not to pursue charges against Mrs. Clinton on her use of a private email server.
Stocks in Asia initially opened higher to track Wall Street’s overnight strength, but several key markets soon reversed into loss. Japan’s Nikkei Stock Average gave up earlier gains of 0.3% and was last down 0.1%, while Australia’s S&P/ASX 200 recovered to trade up 0.1% and Korea’s Kospi was up 0.1%.
“Up until the last few hours there was a sense of complacency” regarding a Clinton win, said Gary Huxtable, a private client adviser at Atlantic Pacific Securities in Sydney. But markets were now backtracking to reprice in the risk that Trump might win, he added.
In the US, the S&P 500 on Monday made its biggest gain since March, closing 2.2% higher and the Dow Jones Industrial Average gained 2.1%.
The Nikkei fell Tuesday despite a 0.1% gain in the US dollar against the Japanese yen. A weaker yen makes Japanese exports more competitive.
Shares of life insurers and banks benefited from higher, long-term government bond yields in the US and Japan. Dai-ichi Life Holdings was up 1.4%, while T&D Holdings rose 1.9%, Sumitomo Mitsui Financial Group gained 0.9% and Nomura added 0.5%.
Prices for Brent crude, the international oil benchmark, rose on reports that Russia signaled it would take part in a deal with members of the Organization of the Petroleum Exporting Countries to cut production. Brent was last up 0.2% at $ 46.22 a barrel in morning Asian trade, though Nymex futures were flat.
In Australia, BHP Billiton rose 2.9% and Rio Tinto added 1.9%. Woodside Petroleum and Oil Search were up by 1.2% and 1.4%, respectively, following gains in crude oil prices.
Stocks in Greater China were higher, though the markets have been stuck in range-bound trade for several sessions. Hong Kong’s Hang Seng Index was up 0.3% and the Shanghai Composite Index added 0.6%.
Government data on Tuesday showed China’s exports continued to fall in dollar terms in October from a year earlier, albeit at a slower pace, as global demand for goods from the world’s second-largest economy remained sluggish. In yuan terms, China’s exports fell 3.2% in October from a year earlier, following a decline of 5.6% in September.
In the Hong Kong market, shares in one of the world’s largest factory middlemen, Li & Fung, were up 0.8%.
Tuesday’s equity-market performance in Asia contrasted with Monday’s strong buying momentum, though the gains in the previous session were mainly due to traders covering their short positions, Chris Weston, chief market strategist at broker IG, said.
“Clients are overwhelmingly asking how much can you trust the polls” for the US election, he said. “Everyone has been burned before,” he said, referring to the shock outcome of the Brexit vote in June.
Write to Kenan Machado at firstname.lastname@example.org
Kosaku Narioka, Jenny Hsu, Liyan Qi and Yifan Xie contributed to this article, which was published by The Wall Street Journal