Donald Trump election triumph sends Wall Street to record highs

The dollar hit its highest level in over four months, and Wall Street stocks and bitcoin hit record highs as investors reacted to Donald Trump’s victory in the presidential election.
Sterling fell 1.2 per cent to $1.29, its lowest level since July, as the dollar strengthened on the prospect of inflationary tariffs, tax cuts and lower regulation.
The dollar index, which tracks the currency against six major currencies including the pound, euro and yen, was up 1.7 per cent, its best day since March 2020.
• Donald Trump wins presidential race
The S&P 500, regarded as a barometer of the health of the world’s largest economy, climbed 146.80 points, or 2.5 per cent, to a record high of 5,929.04, its 48th record close of the year. The Dow Jones industrial average rose 1,508.05 points, or 3.6 per cent, to 43,729.93, its 41st new high this year, while the technology-heavy Nasdaq ­advanced 3 per cent to 18,983.47, its 29th new high this year.
Bitcoin reached a fresh high of $76,231.61 on the prospect of a supportive regulatory environment for crypto currencies during a second Trump ­administration.
Traders working through Tuesday night on Wall Street steadily increased their bets on a Trump victory as the results started to come in, with a Trump win expected to boost equities and the dollar, while putting pressure on bonds and pushing yields higher.
Economists said a Trump presidency could unleash a fresh wave of global inflation. He has threatened to impose 60 per cent tariffs on imports from China, up to 100 per cent on Mexican imports and between 10 per cent and 20 per cent on all other goods brought into America.
Analysts at Goldman Sachs said UK growth will be slower next year because of higher global government borrowing costs, caused by the inflationary consequences of Trump’s protectionist trade policies. UK GDP is now expected to expand by 1.4 per cent next year, down from Goldman’s previous projection of 1.6 per cent. Eurozone growth next year was downgraded from 1.1 per cent to 0.8 per cent.
Philip Shaw, chief economist at Investec, said that if the US followed through on the proposed Trump tariffs, and America’s trading partners retaliated, a “material increase in global inflation would follow, while the ensuing hit to world trade would negatively impact growth”.
American Treasuries fell sharply, sending the benchmark 10-year Treasury yield to its highest since July, as polls also showed Republicans winning control of the Senate and a close race for the House of Representatives. Investors fear that Trump’s policies would widen budget deficits and increase government borrowing, while inflationary tariffs could weigh on the Federal Reserve’s scope to cut interest rates.
Rachel Reeves, the chancellor, told MPs on the Treasury committee that the UK government would make representations to the US government about the importance of free trade.
“President Trump has been president of the United States before and we continue to have a strong and healthy economic relationship,” she said.
“We as a government will continue to make the case for free trade. We are an open trading economy. We benefit from that with our trading relationships with Europe, the Middle East, with Asia and of course with the US.”