×

Markets due for relief rally as election headwinds weaken, investor says

Markets are due for a rally, as headwinds from the U.S. presidential election weaken, one investor told CNBC on Monday.

On Sunday, the Federal Bureau of Investigation (FBI) again cleared Democratic nominee Hillary Clinton of potential criminal charges over her use of a private email server for government business while secretary of state.

Frank Troise, managing director at Leonteq Securities in Singapore, told CNBC's "The Rundown" that Sunday's news would see a huge sigh of relief, as it would likely swing the momentum back in Clinton's favor with just days to go for the election.

"A Trump presidency, as it was becoming unbelievably more realistic last week ... was clearly making markets nervous," Troise said.

Markets sold off last week as the race between Clinton and Trump tightened, after the FBI first revealed it was looking into a new cache of emails related to the server investigation.

The revelation shook up the election campaign and put GOP rival Donald Trump ahead on some polls.

Andrew Renneisen | Getty Images

For months, investors had been pricing in a win by Clinton, and the idea that a Republican-controlled Congress would keep her policies in check.

"The primary concern that the markets were pricing in, believe it or not, was in regards to trade and the implications for trade (under a Trump presidency)," said Troise, in reference to last week's moves lower.

Both Trump and Clinton oppose the 12-nation Trans-Pacific Partnership (TPP) free trade agreement, with the former calling it the worst deal ever.

In October, Trump told an audience in Gettysburg, Pennsylvania, he would take a tough stance on trade, vowing to renegotiate the North American Free Trade Agreement (NAFTA).

"This week, however ... we could see a huge relief rally from here through year end," said Troise.

U.S futures jumped on Monday morning following the FBI's update, with the e-mini Dow futures climbing 220 points before slightly trimming gains. S&P 500 futures and the Nasdaq e-mini futures also gained more than 1 percent.

— Follow CNBC International on Twitter and Facebook.