Dow slumps 200pts as fiscal cliff fears take hold

The S&P 500 has opened down 1.4% and the Dow Jones Industrial Average has shed 200 points in the first trading session after President Obama's election victory.

Though most commentators suggested Obama's re-election has removed one element of uncertainty hanging over US markets, the Republicans' retention of the House of Representatives has put more focus on the forthcoming ‘fiscal cliff'. The S&P opened down 1.4% at 1,408, with the Dow falling 1.5% to 13,052, as investors doubt US politicians' ability to reach a compromise over the package of budget cuts that must be agreed by the end of 2012. The losses came despite US futures markets indicating a higher opening earlier today, with fiscal worries winning out. Some $600bn in fiscal tighte...