US STOCKS-S&P 500 futures turn down after Trump falsely claims victory with key votes uncounted

By Noel Randewich and Alun John. Nov 4- U.S. stock futures turned down on Wednesday in volatile trade after President Donald Trump claimed that he had won the U.S. election even though millions of votes were still uncounted, raising the specter of a lengthy legal battle to resolve the outcome. That marked a sharp reversal from a 1% gain a few hours earlier, after it…

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* S&P futures last down in volatile trade

* Nasdaq futures earlier surge on tech play

* Investors want decisive result and path to stimulus

By Noel Randewich and Alun John

Nov 4 (Reuters) – U.S. stock futures turned down onWednesday in volatile trade after President Donald Trump claimedthat he had won the U.S. election even though millions of voteswere still uncounted, raising the specter of a lengthy legalbattle to resolve the outcome.

Democratic challenge Joe Biden had earlier said that he wasconfident of winning.

The knife-edge election and the prospect of an acrimoniouslegal battle to determine the winner pummeled the S&P eminifutures down 1.15%. That marked a sharp reversal from a1% gain a few hours earlier, after it became apparent Trumpwould win the key battleground state of Florida.

Nasdaq 100 emini futures also pared some earliergains to last be up 0.77%. Some investors had pointed to a lowerthreat of antitrust scrutiny for major technology companiesunder Trump than under a Biden presidency.

“Markets can take almost everything, as long it’s certain,”said Andrea Cicione, head of strategy at TS Lombard in London.

“If this were to go to the Supreme Court, then the resultswould take even longer and that’s probably the worst-casescenario out of all the possible ones.”

“Frankly, we did win,” Trump told supporters at the WhiteHouse, adding the election was a ‘fraud on the American public’,without providing any evidence to support the claim.

Biden’s optimism stemmed from his hopes for wins in theso-called “blue wall” states of Michigan, Wisconsin andPennsylvania that sent Trump to the White House in 2016,although vote counting could stretch for hours or days there.

His expectations for a decisive early victory had faded astelevision networks projected the president won in Florida, amust-win state for Trump, and took the lead in Ohio and Texas.

The surprisingly stronger initial results for Trump boostedU.S. stock futures earlier in the session, pushed downlonger-dated U.S. Treasury yields from five-month highs andsharply dented Mexico’s peso and China’s yuan.

Bob Shea, Chief Executive Officer at TrimTabs AssetManagement in New York, said while Trump was doing better peoplehad defaulted to “‘Trump is good for the market’, so why notjust buy now and cut to the chase.”Investors for months have said they favor a definitive, fastresolution to the election. Quickly settling the election wouldclear the way for a deal on a stimulus package to help thedamaged U.S. economy.

Early results also suggested the Democrats were less likelythan previously expected to take the Senate from Republicans ina so-called blue wave, which could mean a more modest stimulusdeal.

On election night 2016, U.S. stock index futures plunged asTrump pulled off an upset victory against Democrat HillaryClinton. However, the next day marked the start of the so-called”Trump rally” that saw the S&P 500 jump 5% in a month, fueled bypromises of massive tax cuts and financial deregulation.

The S&P 500 has climbed about 57% since Trump’s election in2016, with the information technology index surging149% and energy tumbling 56%, according to Datastream.

In Tuesday’s trading session, the Dow Jones IndustrialAverage rose 2.06%, while the S&P 500 gained 1.78%and the Nasdaq Composite climbed 1.85%.

(Editing by Sam Holmes & Shri Navaratnam)