A Harris bid for presidency changes equation for markets

US stock futures inch higher, indicating a cautious thumbs up to Biden’s decision to step down

- Ven Sreenivasan

Global financial markets are grappling with the ramifications of US President Joe Biden's overnight decision to withdraw from the 2024 presidential race and endorse Vice-President Kamala Harris.

Asian stock markets, the first to react, dropped on July 22 as investors nervously assessed the US news and the impact of the massive global tech outage on July 19.

In Singapore, the Straits Times Index closed down 0.3 per cent. Japan's Nikkei index fell 1.16 per cent, while Australia's S&P/ASX 200 retreated 0.5 per cent and South Korea's Kospi lost 1.14 per cent.

The Shanghai Composite Index slipped 0.61 per cent, as surprise rate cuts by China's central bank emphasised how weak the economy is.

But Hong Kong's Hang Seng Index rallied 1.25 cent, as shares of Chinese data security companies surged on hopes the global tech crash from a faulty software update by US-based CrowdStrike might boost demand for domestic alternatives.

US stock futures inched up, indicating markets there were giving a cautious thumbs up to Mr Biden stepping down and the prospect of a Harris candidature.

While former president Donald Trump had been solidly ahead of Mr Biden in opinion polls, the equation has changed now that Ms Harris is likely to be the Democratic candidate.

Opinion polls place her within 3 percentage points of Trump, but opinion polls can swing.