Trump victory: market whipsaw could spell exotics losses
Seesawing markets prompt speculation of big losses for structured product issuers
Asian benchmarks saw sharp intraday moves
Donald Trump's shock victory in the US presidential election unleashed a hectic day of trading across global markets, with a huge sell-off in equities and rates assets during Asian trading hours followed by a watchful European session, then a full-blooded risk-on US session.
The whipsawing moves prompted speculation that dealers could face losses on hedges tied to their exotics books, with one source predicting losses for structured products issuers in the double-digit millions of US dollars.
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