Election night has turned into much more of a nail biter than many figured, and that anxiousness is showing in the financial markets. As the possibility of a Donald Trump presidency sees more legitimacy, stock futures plummeted in reaction to Trump's potential success Tuesday night. The Dow was down 700 points on Tuesday night, and the Mexican Peso fell 11.5 percent, its biggest drop in 20 years.
Earlier on Tuesday, markets closed high on Election Day on the prediction of a Hillary Clinton win. The news this week that Clinton would not face renewed investigation into her use of a private email server bolstered confidence in her chances of winning. A Clinton win is seen by experts as positive for the markets, since she is seen as the more predictable candidate, who will likely provide continuity. But as the results trickle in, and Trump is holding a slight lead over Clinton, the markets plunged on the possibility of a Trump presidency. He is seen as an uncertain and unpredictable candidate, and the financial markets don't like unpredictability.
Analysts are saying that markets were shifting as Florida predictions changed. The state continued to change hands early on, but Trump has maintained a lead, and it seems like those 29 electoral votes will go to him. But Florida is definitely not the only battleground state in play tonight. All eyes are on states like North Carolina, Virginia, Nevada, Michigan, Wisconsin and Pennsylvania.
While things look tight, and CNN's John King will continue running various electoral scenarios on his "magic wall" for hours to come, a surprisingly solid predictor of who will win the election are the markets themselves. If markets are up in the three months preceding the election, than the incumbent party will usually hold control of the White House. If the reverse is true, than the challenging party will take the presidency. This has been an election cycle like none other, so it remains to be seen if that signifier holds true tonight.
Global markets are also feeling the turmoil from the U.S. election. On Wednesday morning, Asian markets opened down. Markets in Hong Kong and South Korea had fallen around 2 percent, while markets in Japan, Australia and New Zealand was down about 4 percent.
The night is far from over, but as the markets indicate, confidence in the Democratic candidate has taken a hit.