US 2016 election results - Analysts react

"Demographics are slowly reversing the super cycle but more importantly in the short-term it felt to us that politicians would either have to address the mass disaffection to current policies and trends of this 35 year super cycle or face a wave of anti-establishment support and eventually being thrown out. Well Trump, assuming he wins, is a perfect example of this [...] If Trump wins then that could increase the odds of both a better medium-term economic outlook and also a worse economic outlook. It also has geo-political ramifications that are hard to contemplate at this stage. EM looks vulnerable as US self interest could dominate. Trade deals could be ripped up. Ironically Trump has hinted that a trade deal with the UK could be a priority!!" - Jim Reid, Deutsche Bank

"Markets are choppy and some of these earlier moves have partially been reversed, but we think that this risk-off mood could last for several days or more, before markets ultimately calm down and digest the incoming news flow. The extent and duration of the market reaction will depend critically on what Mr. Trump will say when he has victory in his hand. Everybody will pay close attention to Mr. Trump’s upcoming speeches. How will he set his policy priorities? Who will be in his cabinet? And how will he treat previous opponents or non-supporters, including Paul Ryan?" - Dr. Harm Bandholz, UniCredit Bank

"A Trump victory would certainly surprise markets and generate a global uncertainty shock. Nonetheless, our view is that it will entail a less prolonged uncertainty shock than Brexit." - SocGen

"If current results hold, a Republican sweep has emerged, against our expectations. Markets must balance a tax-cut stimulus against trade protection risks. Uncertainty hurts risk assets near term. Trade-exposed currencies weaker; yield curves steeper; Banks & Pharma to outperform; Munis to weaken. [....] With a Trump win, weexpect investors to act defensively in the near term as they recalibrate a potential policy shift: The "surprise" result will encourage investors to protect still-reasonable YTD gains,and await more clarity about the new president's cabinet and policy priorities. We would be skeptical about buying the dip." - Morgan Stanley

"Over the course of the election campaign, Donald Trump has proposed a number of farreaching policy changes that would likely have dramatic impacts on the outlook for economic growth, inflation and financial markets. Whether his proposals will actually be implemented depends on the willingness of Congress to enact legislation to put his proposals into law." - HSBC

"The sell-off in EM financial markets in the wake of Donald Trump’s victory in the US election has been swift but policymakers in most countries will look through the initial volatility – only central banks in Mexico and (possibly) Turkey are likely to be forced into defensive interest rate hikes over the coming days. Further out, questions still hang over large parts of Mr. Trump’s likely policy agenda, but the big issue for EMs is his approach to trade. Watch out for early noises on China and Mexico." - Capital Economics

"Even if [Trump] were to follow through on only half of his vigorous campaign promises, this could cause considerable unrest. Despite that, we do not think that investors should lose their nerve. Let us not forget that the key constant in Trump’s election campaign was to continually surprise the public. It is entirely possible that after his election, he could in fact surprise markets on the positive side. Our hopes are based on Trump’s pragmatism, his ability to adapt and his generally limited political allegiance. There is a chance that he could allow the political veterans in Congress to pass a fairly classical Republican campaign program." - Stefan Kreuzkamp, Deutsche Bank

"As is always the case, volatility creates opportunities. There are several countries that are relatively closed economically, such as India and Brazil, that have relatively low trade or immigration ties with the US. Countries within Eastern Europe are much more dependent on Europe than the US for their exports or financial channels. In this respect, they will be much more impacted by the upcoming Italian, French and German political events than the US election. Russia may benefit from today’s result should the US start easing financial sanctions. Finally, commodity credits such as Sub-Saharan African issuers are much more dependent on China as a driver for commodity demand or for financing than the US. In terms of relations with China, imposition of trade tariffs and whether the US Treasury will name China as a currency manipulator will be the key events to watch.” - Claudia Calich, Manager of the M&G Emerging Market Bond Fund