LONDON: World stock markets recovered from a sharp initial downturn to maverick Republican Donald Trump's shock election win on Wednesday, quickly regaining their poise with surprising resilience.
Asia kicked off a "Trump slump", with Tokyo diving on concerns over the untested policies of the billionaire businessman and reality TV star.
Europe followed suit, tipping about two percent lower at the open, but later rallied as nerves were calmed by Trump's conciliatory victory speech and a firmer Wall Street.
At the end of the European day, London stood 1.0 percent higher, Frankfurt added 1.6 percent and Paris 1.5 percent -- confounding forecasters.
"The much-feared election of Donald Trump didn't cause the one-way negative reaction in markets many expected," CMC Markets analyst Jasper Lawler said.
Andrew Kenningham, Senior Global Economist at Capital Economics said that Trump's triumph had actually made little difference to the immediate outlook for the global economy," but added that there were "bigger question marks" over longer-term prospects.
- 'Broadly inflationary' -
"As people have come to make considered assessments, the reaction seems more rational," added David Jane at Miton's.
Trump's expected economic policies, Jane said, will be "broadly inflationary".
This means, he said, that they will be "supportive of equity markets and negative for bonds".
This view was borne out Wednesday by a swing in sovereign bond yields which rose as the day wore on, having initially dipped in flight-to-safety buying.
Even the benchmark German Treasury bond, a safe haven in times of uncertainty, gave up most of its early gains to end the day with a yield of 0.176 percent, against a day's low of 0.092 percent.
US bond yields meanwhile rose on the prospect of a rising Federal budget deficit under Trump.
The US election outcome has drawn direct comparisons with Britain's shock Brexit vote in June to leave the European Union.
"Of course, just as Britain has not yet Brexited, America has not officially entered the era of Trump," said Spreadex analyst Connor Campbell.
Rebecca O'Keeffe, head of investment at stockbroker Interactive Investor, said there were "significant" worries over Trump's policies. "Trump is a huge leap into the unknown," she told AFP.
- Winners, losers -
But, as CMC's Lawler noted, "things are never black and white and Donald Trump can be a positive force, or at least a less negative force than Hillary Clinton, for some sectors of the stock market".
Pharmaceutical stocks surged as Clinton's campaign for cheaper drugs was off the table after her defeat, with Sanofi, Bayer and AstraZeneca all sharply higher.
Defence stocks also rose, on expectations of higher US military spending.
Auto shares, meanwhile, underperformed on fears of protectionist measures imposed by Trump.
Financials were mixed, but Spain's second-biggest bank, BBVA, fell nearly six percent, punished by investors for its high exposure to the Mexican market.
The Mexican peso -- which has been battered by Trump's anti-Mexican promises that included the construction of a border wall -- fell over eight percent and the Mexican stock market was around two percent down.
The dollar recovered from early losses, and even showed gains against the euro in the European afternoon.
Earlier in Asia, Tokyo stocks collapsed 5.4 percent and Hong fell 2.2 percent.
Moscow however rose almost two percent on hopes of improving US relations as President Vladimir Putin congratulated Trump.
- Key figures around 1650 GMT -
London - FTSE 100: UP 1.0 percent at 6,911.84 (close)
Frankfurt - DAX 30: UP 1.6 percent at 10,646.01 (close)
Paris - CAC 40: UP 1.5 percent at 4,543.48 (close)
EURO STOXX 50: UP 0.9 percent at 3,052.33
New York - Dow: UP 0.8 percent at 18,474.84
Tokyo - Nikkei 225: DOWN 5.4 percent at 16,251.54 (close)
Hong Kong - Hang Seng: DOWN 2.2 percent at 22,415.19 (close)
Shanghai - Composite: DOWN 0.6 percent at 3,128.37 (close)
Dollar/Mexican peso: UP at 19.7380 pesos from 18.3329 pesos
Pound/dollar: UP at $1.2458 from $1.2378 Tuesday
Euro/dollar: DOWN at $1.0942 from $1.1020
Dollar/yen: DOWN at 104.87 yen from 105.86 yen
Oil - West Texas Intermediate: DOWN 16 cents at $44.91 per barrel
Oil - Brent North Sea: DOWN 17 cents at $45.87