World markets traded lower Wednesday despite strong gains in Asia overnight as investors booked profits after Senator Barack Obama won the U.S. presidential election and the Democrats took a firmer hold on Congress. On Wall Street, the Dow Jones industrial average fell 170.53 points, or 1.77 percent, to 9,454.75, while the Standard & Poor's 500 index dropped 18.30, or 1.82 percent, to 987.45 The FTSE 100 index of leading British shares was down 106.49 points, or 2.3 percent, at 4,533.04, while Germany's DAX was 103.21 points, or 2.0 percent, lower at 5,174.83. The CAC-40 in France was 85.98 points, or 2.3 percent, lower at 3,605.11. The losses in Europe and the U.S. follow surges Tuesday in anticipation of an Obama victory. The Dow in fact enjoyed its best election day rally since 1984. «Everyone was buying the rumor yesterday and selling the news today ... The market had not only anticipated an Obama victory, but from what I'm gleaning, pretty much a Democratic sweep,» said Jack A. Ablin, chief investment officer at Harris Private Bank. Investors also know that Obama will have his work cut out for him to improve the U.S.'s immediate economic prospects and that Inauguration Day is still more than two months away. «Between now and then there is unlikely to be much if any positive economic news,» said Howard Wheeldon, senior strategist at BGC Partners in London. Further proof of the scale of the downturn in the world's largest economy came Wednesday with the news that the U.S. service sector contracted sharply in October as new orders and employment fell. The Institute for Supply Management, a trade group of purchasing executives, says the services sector index fell to 44.4 in October from 50.2 in September. Analysts had anticipated a far more modest drop. A manufacturing report issued Monday by the same organization showed the worst reading since September 1982, when the U.S. was in a deep recession.
