Wall Street stocks hit a record high and the dollar rallied as Donald Trump’s US election victory sent markets around the world scrambling to price in a new regime of trade tariffs and tax cuts.
The S&P 500 index closed 2.5 per cent higher on Wednesday, its biggest daily jump in two years, while the Nasdaq Composite jumped 3 per cent.
The broader Russell 2000 index, the bellwether for US small-cap stocks, jumped 5.8 per cent as investors bet that a faster-growing US economy would benefit a wider range of sectors beyond highly valued tech stocks.
The dollar surged the most in two years as traders returned to so-called Trump trades in the expectation that the president-elect’s plans would boost stocks, push up inflation and reduce the pace of interest rate cuts.
The dollar index, a measure of the currency against a basket of rivals, was up 1.6 per cent by early afternoon in New York, on track for its biggest one-day gain since September 2022.
