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Traders watch Hillary Clinton's speech on a television screen on the floor of the New York Stock Exchange, Wednesday, Nov. 9, 2016. (AP Photo/Richard Drew)

US markets clawed back lost ground with the hope of business-friendly policies



UPDATE 4:05 p.m. EST:  It was a wild day for markets. The Dow soared 257 points at the close.

Following the Donald Trump election upset, banks, drug, and defense stocks rallied big. Financials also surged. The hope on Wall Street is that as president, Trump will enact business-friendly policies.

“Our base case is we’re more likely to see a more moderate president than we saw as a candidate and the market’s agreeing with that,” Lowell Yura, head of multi-asset solutions for BMO Global Asset Management, told Bloomberg. “We don’t see a huge impact to short-term earnings and short-term economic growth.”

UPDATE 2:58 p.m. EST:  U.S. stocks are moving solidly higher in mid-afternoon trade.

Despite the lack of clarity on Trump's actual policies, markets still managed to recover.

UPDATE 12:53 p.m. EST:  After Hillary Clinton conceded, the markets turned green.

U.S. stock markets fluctuated in early trade Wednesday after a messy, chaotic night.

Priced for a Hillary win

Overnight, global markets tanked hard as it became clear that Donald Trump would win the presidency. Dow futures and Asian stock prices plunged, grappling with the looming uncertainties over trade, immigration and geopolitical tensions.

Investors had been pricing the market on a Hillary Clinton win, and the prospect of a Trump presidency sent them reeling.

The Mexican peso fell to its lowest levels. Their central bank held an emergency meeting.

As traders made sense of Donald Trump's stunning win, Wall Street expected the worst.

But as election shock faded, the losses weren't as dire as the ones post-Brexit.

Though the market is set for a volatile trading day, things were pretty chill early on.

Drug, biotech and pharmaceutical stocks were trading higher Wednesday morning.

Also an early winner: Gold.

Shock and fear, at first

Defense industry stocks were also faring well and the dollar had managed to claw back some ground by the time of the open.

"The market's initial response to the probability of a Trump win was, predictably enough, one of shock and fear," James Athey, fixed income fund manager at Aberdeen Asset Management, told CNBC. "However the increased prospect of tax cuts and a generally pro-growth set of policies from him... has seen some of this initial reaction begin to reverse."

Interest rates on everyone's minds

Analysts have already lowered their views about the Federal Reserve raising interest rates in December. Beyond haziness around trade, taxes and foreign policy, Trump's win has created confusion about rates.

The Fed, which is charged with making decisions on economic policy, financial experts will keep a close eye on how it handles the results.

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