LONDON: Wall Street rallied into record territory, the dollar soared and bitcoin scaled a new peak Wednesday as the world gears up for another Donald Trump presidency.

The Republican candidate made a stunning political comeback as he defeated Vice President Kamala Harris to return to the White House, four years after losing it to Joe Biden.

The Dow soared three percent while the S&P 500 and Nasdaq Composite jumped around two percent.

`The rationale behind the US stock market rally is that Trump is seen as business-friendly and will be able to pass his tax cuts through easily without much resistance from the Democrats who have lost control of the Senate, said City Index and FOREX.com analyst Fawad Razagzada.

Briefing.com analyst Patrick O`Hare said Trump`s policies `which feature lower tax rates and deregulation among the cornerstones, are being heralded by the stock market as pro-growth policies that will be a boon for corporate profit growth`.

Markets are also applauding the clarity of Tuesday`s results, said Jason Schenker of Prestige Economics.

But in a sign that investors are also nervous about the impact of Trump`s protectionist policies, European stock markets gave up strong earlier gains toslip into the red. Frankfurt fell 1.1 per cent with shares in automakers -a possible target of Trump tariffs -slumping.

Asian stocks diverged, with Chinese stocks hit by expectations that Trump would impose tariffs on Chinese imports.

Trump tax cuts, while good for corporate profits, are seen as inflationary and therefore leading to fewer interest-rate cuts by the Federal Reserve in the coming months.

That boosted the dollar against main rivals, with the greenback up around two percent against the euro.

The Fed announces its latest rate decision on Thursday.

She added that `expectations are high that a Trump presidency will mean fewer regulations on big tech and big finance`.

Shares in Tesla soared 13pc after Trump praised the electric car maker`s boss Elon Musk, a key campaign backer, as a `star` during his victory speech.

TrumpMedia & Technology Group,in which the former president owns a majority stake, soared about 30pc. From their all-time lows hit in late September, they have nearly tripled in value. His stake was last valued at about $5bn.

Bitcoin record Bitcoin sprung $6,000 higher to a record $75,371.67, topping its previous peak of nearly $74,000 in March.

Trump has pledged to make the United States the `bitcoin and cryptocurrency capital of the world` and to put tech billionaire Musk in charge of a wide-ranging audit of governmental waste.-Agencies