Business

Asian markets drop over Biden’s withdrawal from U.S. presidential race

Asian markets fell on Monday, July 22, 2024, as United States President Joe Biden’s decision to drop out of the presidential race fuelled fresh uncertainty.

Traders appeared unmoved by China’s decision to cut interest rates in a bid to boost its stuttering economy.

After last weekend’s assassination attempt on former U.S. President Donald Trump – and the following Republican convention – boosted bets he would win November’s election, investors were trying to work out the ramifications of the latest news out of the White House.

Biden on Sunday gave in to weeks of calls for him to step aside in the wake of a poor debate performance that amplified questions about his health, and endorsed Vice President Kamala Harris to succeed him.

The news has left traders wondering who will go head to head with Trump, whose expected victory had lifted equities and the dollar on expectations for tax cuts and deregulation.

Analysts said markets would likely be volatile in the near term.

Biden withdraws from U.S. presidential race, endorses Kamala Harris

National Australia Bank’s Ray Attrill said: “While market instinct will be to say that the news adds a degree of uncertainty to the outcome of the 5 November election that wasn’t present last week, it will be many weeks… before anyone can reasonably determine if the race for the White House is significantly narrower than looked to be case previously.

“In short, there’ll be more noise than signal on U.S. politics for markets to contend with in the coming few weeks at least.”

Stocks in Asia fell on Monday following losses on Wall Street and in Europe, where trade was dominated by a crash in global computer systems – the result of a faulty update to an antivirus program – that hit airports, airlines, trains, banks, shops and even doctors’ appointments, AFP reports.

Tokyo, Shanghai, Sydney, Seoul, Singapore, Taipei, Mumbai, Wellington, and Manila all fell, though Hong Kong rallied thanks to healthy gains in Chinese tech firms.

London, Frankfurt, and Paris all rose at the open.

Stephen Innes said in his Dark Side Of The Boom commentary: “It’s as if the political game of chess has flipped its board, and investors are left picking up the pieces.

“This unexpected twist has injected a hefty dose of political uncertainty into the market, leaving everyone scrambling to determine their next move.”

Key figures on Monday:

Tokyo – Nikkei 225: DOWN 1.2 per cent at 39,599.00 (close)

Hong Kong – Hang Seng Index: UP 1.3 per cent at 17,639.71

Shanghai – Composite: DOWN 0.6 per cent at 2,964.22 (close)

London – FTSE 100: UP 0.6 per cent at 8,200.51

Euro/dollar: DOWN at $1.0881 from $1.0885 on Friday

Pound/dollar: UP at $1.2917 from $1.2914

Dollar/yen: UP at 156.50 yen from 157.47 yen

Euro/pound: UP at 84.23 pence at 84.27 pence

West Texas Intermediate: UP 0.5 per cent at $80.49 per barrel

Brent North Sea Crude: UP 0.4 per cent at $82.97 per barrel