World Markets Await U.S. Election Results, Antiquated System

Barry Randall
06 Nov, 2012
New York City

U.S. stocks closed higher on the Election Day on high voter turnout but the presidential race is close and final outcome may not be known until late tomorrow. U.S. struggles with antiquated election infrastructure that is managed by states with the lack of consistency in voting hours.

[R]4:15 PM, New York – U.S. stocks closed higher on the Election Day on high voter turnout but the presidential race is close and final outcome may not be known until late tomorrow. U.S. struggles with antiquated election infrastructure that is managed by states with the lack of consistency in voting hours and access to voting booths.[/R]

U.S. indexes gained between 0.4% and 1% on the Election Day as high turnout of voters across the country is set to determine the political future for the next two years.

President Barack Obama is in a tight presidential race with the Republican challenger Mitt Romney and the outcome of the election may not be known well into Wednesday. Several lawmakers are also running for the U.S. Senate and the House and the Democratic Party is expected to retain the control of the Senate and the Republican Party is expected to remain in majority in the House.

The U.S. election system is one of the most antiquated infrastructures in the world where elections locations and hours are determined by state agencies and regulators and voting hours vary from one state to the other.

Also, major broadcasting channels forecast election results even before polling close on the West Coast which is three hours behind.

The U.S. is one of the few advanced nations that does not have federal election infrastructure and most of the states are following decades old system of limited early voting and dilapidated technology.

Several states including swing states Florida, Ohio, Colorado and Virginia have long ballots with confusing language and limited voting hours or fewer voting locations that could dampen voter turnout especially in poor areas and among minority voters.

And, online voting is still not available in most states across the nation.

In other news, Canada permitted exports of uranium and nuclear reactors to India and Inergy agreed to purchase Rangeland Energy for $425 million.

In corporate news, AOL third quarter net swung to $20.8 million profit. CVS Caremark net jumped 16% to $1.01 billion on sales growth. DirecTV third quarter net climbed 9% to $565 million as subscriber jumped. EOG Resources net slumped 34% and NYSE Euronext net declined 42% to $108 million.

The European indexes advanced and Greece and Spain weighed on the market sentiment. Greece faced third major strike that crippled the nation in less than six weeks as public workers union resists additional 25% cuts in pension and holiday bonuses.

Separately, the IMF warned that the growth outlook for France remains fragile and another report from the European Commission said Spanish economy is forecasted to contract 1.6% this year.

Euro zone private sector contracted more than initially estimated and service sector activity and new orders in the Spain continued to shrink in October. German factory orders fell in September.

Aer Lingus passenger traffic improved in October. BMW profit rose 16% to €1.29 billion and Fraport revenue rose to €700.6 million in the third quarter. Lanxess quarterly earnings plunged 39% to €94 million.

The UK indexes climbed after production fell in September. Home prices in the UK declined but new car registrations rose in October. BG Group completed the sale of Brazil based Comgás stake to Cosan.

Stocks in Tokyo traded lower as more companies report weak results and the yen strengthened ahead of the U.S. elections. Dainippon and NTN reversed their annual profit estimate to losses.

Australian stocks closed higher as trading volume declined for the third day in a row. Resource stocks closed mixed and banks were in focus for the second day in a row. Australian dollar edged higher after the Reserve Bank left its key rate on hold.

Commodities, Bonds and Currencies

U.S. treasury yield on 10-year bond increased to 1.74% and on 30-year bond rose to 2.91%.

The U.S. dollar inched higher to $1.282 to a euro and increased against the Japanese yen to 80.40 yen.

Immediate delivery futures of Texas crude oil increased $2.66 to $88.36 a barrel and Brent crude rose $3.10 to $110.88, futures of natural gas increased 0.06 cents to $3.62 per mbtu and gasoline traded up 7.1 cents to 269.26 cents a gallon.

In metals trading, copper decreased 0.40 cents to $3.47 per pound, gold increased $30.30 to $1,713.50 per ounce and silver increased $0.82 to $31.95.