Construction, pharma, gold miners seen as Europe's top Trump trades
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A trader at the stock exchange reacts in Frankfurt, Germany. REUTERS/Kai Pfaffenbach
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LONDON (Reuters) - Global markets reacted on Wednesday with concern to Donald Trump's surprise victory in the U.S. presidential election, but construction, pharma and gold mining stocks emerged as big winners in the European trading session.
Gains in those three sectors helped pull European stocks <.STOXX> off their early lows that had followed a slump in Wall Street futures. The European index had been expected to open as much as 4 percent lower on the election outcome but in the end was only down about two percent at the outset.
At 0858 ET the index was down 0.4 percent.
Healthcare stocks <.SXDP> were the biggest outperformers, up 2.8 percent, followed by basic resources <.SXPP>, up 2.4 percent, and construction and materials <.SXOP>, up 1.2 percent.
The STOXX 600 was down 0.6 percent by midday trading.
Markets had expected Democrat contender Hillary Clinton to win the election rather than Trump, a political outsider with no experience of public office. Growth-sensitive shares such as autos, financial and travel shares all came under pressure from the uncertainty over what a Trump presidency will look like.
Stocks with substantial revenue exposure to the Mexican peso, and some with U.S. exposure, were also hit as both currencies have come under pressure.
However, stocks of companies with American exposure that stand to benefit from Trump's spending plans are seeing a lift. And those that have costs in pesos, rather than derive revenues from Mexico, are also "winners" from the election result.
* BAE SYSTEMS
* CRH (NYSE: CRH) - The construction firm hit a nine-year high on Wednesday as Trump has pledged to boost infrastructure spending. Trump's acceptance speech, which struck a conciliatory note and avoided reference to controversial policies mentioned on the campaign trail, reiterated his commitment to increased infrastructure spending. CRH derives 50 percent of its revenues from the United States.
* ASHTEAD (NYSE: AHT) - Ashtead is identified by Deutsche Bank as the European firm with the highest exposure to increased infrastructure spending in the United States, with 84 percent of its revenues derived there.
* BBVA (NYSE: BBVA) - BBVA is identified by Credit Suisse and Societe Generale as the European bank most exposed to Mexico, from where it derives around 30 percent of its revenues. The stock would suffer if Trump got into power and scrapped the North American Free Trade Agreement, as he has pledged to do. BBVA was down 8.8 percent, its biggest one-day fall since the Brexit vote.
* TATE AND LYLE
* VESTAS WIND
* DSV (NYSE: DSV) - Cantor Fitzgerald highlight transport and logistics stocks as being at risk should a Trump presidency result in a slowdown in global trade. "The risk for the larger global freight forwarding operators... is that trade is impeded with new barriers, particularly with China." Denmark's DSV was down 3 percent.
(Reporting by Alistair Smout; Editing by Gareth Jones)
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