Global oil prices and the US dollar recorded declines on Wednesday following a major setback for President Donald Trump and his Republican Party in the United States midterm elections.
The election results saw Democrats secure control of both chambers of Congress, giving them greater influence over legislative decisions and the power to challenge key policies of the Trump administration.
The development unsettled financial markets as investors began assessing its possible implications for the US economy and global trade.
Market analysts attributed the dollar’s decline partly to concerns that the election outcome could trigger political disagreements between the White House and Congress, potentially slowing down government decisions.
Trump had earlier indicated that he would strongly oppose legislative moves he disagreed with, raising concerns about possible political uncertainty in the coming months.
Oil prices also moved lower, with Brent crude falling by 1.2 per cent to $102.36 per barrel, while US West Texas Intermediate crude dropped 0.8 per cent to $95.42 per barrel.
The election was widely viewed as a major test of public confidence in Trump’s leadership, with voters expressing concerns over rising fuel costs, the effects of tariffs and the ongoing conflict involving Iran.
However, analysts cautioned that the Democrats’ victory might not immediately translate into major changes in US economic policy, noting that Trump still retains considerable executive powers.
While Asian markets recorded mixed performances, European stocks moved higher during Wednesday’s trading session. London’s FTSE 100 gained 1.2 per cent, while France’s CAC 40 and Germany’s DAX rose by 1.5 per cent each.
In Asia, Japan’s Nikkei 225 declined by 1.4 per cent, while Hong Kong’s Hang Seng Index gained 1.7 per cent and China’s Shanghai Composite advanced by 2.2 per cent.
Gold also attracted investors seeking safer assets amid the political uncertainty, while attention remained on corporate earnings and developments in the global economy.
Meanwhile, German automobile manufacturer BMW announced plans to increase its proposed job cuts after reporting lower third-quarter profits, citing intense competition and weakening demand in China.
Google also disclosed plans to invest $15 billion in Malaysia over the next two years to develop data centres and other infrastructure.
