Ballot box US elections © niyazz /123RF Stock PhotosU.S. stock futures and markets around the world are mostly holding steady or ticking higher in early Wednesday trading, but only after spinning through an election night dominated by surprises and sharp swings.

After rallying early this week amid hopes that Election Day’s arrival could clear the uncertainty that’s been weighing on markets, Treasury yields and U.S. stock futures swung up, down and back again overnight as early results showed a race that’s still too close to call between President Donald Trump and former Vice-President Joe Biden. It’s unclear when a winner can emerge.

Some of the sharpest moves were in yields for U.S. government bonds, which had earlier risen on expectations that a Democratic sweep could mean big stimulus for the economy coming from Washington.

The 10-year Treasury yield swung from 0.88 per cent late Tuesday up to 0.94 per cent shortly after polls closed. It then sank to 0.77 per cent as odds for a Democratic takeover of the Senate diminished and after Trump made premature claims of victories in several key states. It recovered to 0.81 per cent roughly two hours before trading on Wall Street was set to open.

U.S. stock futures swung through similar gyrations. S&P 500 futures rose, fell and rose again before sitting on a gain of 1.2 per cent, as of 7:27 a.m. eastern time. Dow futures were 0.4 per cent higher.

One corner of the market that stayed strong was big U.S. technology stocks. Investors have increasingly seen these stocks as some of the safer bets in the market, able to grow their profits even in a pandemic as more of daily life shifts online. They don’t need a big stimulus effort the economy as much as other companies, and Nasdaq futures 100 futures were up 2.8 per cent.

All the swings are a bit reminiscent of four years earlier, when Trump surprised the market by winning the White House. Markets initially tumbled after polls and the market’s expectations proved to be so wrong in 2016, but they quickly turned around on expectations that Trump’s pro-business stance would be good for corporate profits.

The difference this time is that the uncertainty seems set to linger. It may take days for a winner of the White House to emerge, and professional investors say they’re bracing for sharp market swings in the meantime. Trump said early Wednesday that he’d take the election to the Supreme Court, though it’s unclear exactly what he means by that as states continue to tally all their votes.

“Both candidates at this stage often claim victory, but it’s rare that we see an invocation of the court system at this point, and we expect quite a lot of market volatility,” Rick Lacaille, global chief investment officer at State Street Global Advisors, said in a statement.

A contested election was a worst-case scenario for markets because it would only prolong the uncertainty that’s been keeping investors on edge.

“Basically, we are seeing a nightmare situation come true because now we are talking about legal battles,” said Naeem Aslam, analyst at

The large number of Americans who voted early means the result of this presidential election might not be known for days.

“The market hates uncertainty and if we have continued uncertainty, then we’re going to see prices fall, we’re going to see volatility remaining high,” said Kiran Ganesh, analyst at UBS bank.

In the end, though, many fund managers suggest investors hold steady through the tumult in large part because one person can’t singlehandedly move the economy and stocks tend to rise regardless of which party controls the White House.

While a Trump win may lessen the odds of a big stimulus package for the economy, something that investors have been clamouring for, it would also likely mean four more years of low tax rates and lighter regulation on businesses. What happens with the coronavirus pandemic will have a much greater effect on markets than this election’s results, many fund managers say.

In European trading, Germany’s DAX recovered from early losses, gaining 0.7 per cent. The CAC 40 in Paris rose one per cent, and the FTSE 100 in London climbed 0.7 per cent.

In Asia, the Nikkei 225 in Tokyo advanced 1.7 per cent, while the Kospi in Seoul added 0.6 per cent. The Hang Seng in Hong Kong declined 0.2 per cent, while stocks in Shanghai added 0.2 per cent.