European stocks are seen opening higher on Wednesday even as early results showed a tight race in U.S. battleground states.
All eyes are on the swing states which can bring a change in the final results. Amid a noticeable increase in mail-in voting, some states may take a little longer than usual to declare the winner of the election.
Connecticut and Indiana are expected to declare their results by November 5 at the latest. Michigan and Pennsylvania are expected to declare their results by November 6.
Asian markets remain mostly higher as investors discounted the odds of a clean Democratic sweep.
The dollar dipped against a basket of currencies as the focus shifted to the Federal Reserve and Bank of England meetings due Thursday.
No major changes in U.S. monetary policy are expected, but markets will be looking for guidance on future actions from the Fed.
The Bank of England is expected to launch another £100 billion of economy-boosting action to shore up the economy in the face of a second wave of the coronavirus pandemic.
In economic releases, the services sector in China continued to expand in October, and at a faster rate, the latest survey from Caixin revealed with a services PMI score of 56.8, up from 54.8 in September.
Final Purchasing Managers' survey results from euro area and other major European economies are due later in the session, headlining a light day for the European economic news.
Across the Atlantic, reports on private sector employment, the trade deficit and service sector activity may attract some attention.
U.S. stocks posted strong gains overnight as investors hoped for a definitive outcome from the presidential election and that there would be a swift deal on more fiscal stimulus. Upbeat durable goods orders data also added to signs of economic recovery.
The Dow Jones Industrial Average climbed 2.1 percent, the tech-heavy Nasdaq Composite index surged 1.9 percent and the S&P 500 advanced 1.8 percent.
European markets ended Tuesday's session on an upbeat note as investors held out hopes for a clear verdict in the U.S. election without the need for lawsuits and recounts.
The pan European Stoxx 600 rose 2.3 percent. The German DAX jumped 2.6 percent, France's CAC 40 index gained 2.4 percent and the U.K.'s FTSE 100 added 2.3 percent.
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