THE POTENTIAL OUTCOMES OF THE US PRESIDENTIAL ELECTION:
IF DONALD TRUMP WINS:
*US and global stock markets are forecast to fall between five to 10 per cent
*The US Federal Reserve would be unlikely to raise rates in December because of market volatility
*Mr Trump could damage America's international relations, particularly with China given his protectionist policies. This in turn could hurt the global economy.
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*If Mr Trump's proposed cut to the US company tax rate to 15 per cent from 35 per cent was implemented it would fall below Australia's corporate tax rate, encouraging US companies to send earnings straight back to the US rather than hold funds in Australia.
*Mr Trump opposes the Trans-Pacific Partnership (TPP) - a 12 nation regional free trade agreement that includes Australia, Canada, Japan and the United States
IF HILLARY CLINTON WINS:
* Stock markets around the world could see a relief rally following weeks of uncertainty
* US dollar would rise but gains likely to be limited
*Good news for international alliances and trade agreements, which will be a positive for Australia given its reliance on the trade industry
* Mrs Clinton also opposes the TPP
DIVIDED GOVERNMENT:
*A divided government is the most likely outcome of the election, with Hillary Clinton winning the presidency and Republicans retaining control of at least one chamber of Congress, most likely the House of Representatives
*A split government is likely to be neutral or slightly positive for markets
*The US dollar is expected to jump regardless of the winner, which is likely to put pressure on the Australian dollar
