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Bitcoin extends sweeping rally; eyes $100K

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Tariff worries weigh on euro and yuan

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Stocks sag in Europe

(Updates throughout; refreshes prices at 1010 GMT)

By Amanda Cooper

LONDON, Nov 12 (Reuters) - Global stocks came under

pressure on Tuesday from investor concern about U.S.

President-elect Donald Trump's policies, while bitcoin neared a

record $90,000 as traders piled into assets they believe could

benefit from the new administration.

Investors have been funnelling cash into assets they think

will get a boost from Trump's second four-year term in office,

in which he has vowed to raise tariffs on imports from key

trading partners, as well as bring in tax cuts and looser

regulations.

Bitcoin, the world's biggest cryptocurrency, was trading

just shy of a record $90,000, having gained 30% in the week

since the election, while the S&P 500 has vaulted to yet

more all-time peaks, as have small cap stocks.

On the flipside, the likes of the euro and Chinese

yuan have come under intense fire, as investors assess

the risk of a steep rise in tariffs, as well as the risk of the

Chinese economy continuing to struggle even with Beijing's raft

of multi-trillion dollar stimulus measures.

Given how tight the race for the White House had appeared,

based on opinion polls ahead of the election, a lot of investors

are unwinding some of their bets on either an outright win by

the Democrats or a divided government, according to Samy Chaar,

an economist at Lombard Odier in Switzerland.

There is also uncertainty over how hard a line Trump will

take towards any number of factors, from trade with China to

Russia's war in Ukraine, meaning investors must position

accordingly.

"As we know more about the nomination process, we will know

more if we're going to have to erase the 'more moderate' path or

if we can eventually dampen the (bets on) a 'less compromising'

path," he said.

"For now, we're in that situation. We're in a situation of a

Republican sweep, but within that, there are still some

uncertainties on the kind of path he's going to follow."

KING DOLLAR

Either way, the dollar is expected to benefit from some of

the policies that will likely keep U.S. interest rates

relatively higher for longer. The dollar index, which

measures the U.S. currency against six others, was at 105.59,

just shy of the 4-month high hit on Monday.

The MSCI All-World share index was down

0.4%, under pressure from a near-1% drop in Europe's STOXX 600

and from weakness in U.S. stock futures ,

which were down 0.2%.

Asian markets fell on the back of steep declines in

semiconductor shares, following a report from Reuters that the

U.S. ordered Taiwan Semiconductor Manufacturing Co ( TSM ) to

halt shipments of advanced chips to Chinese customers.

Even with Trump not due to take office for months,

China-exposed parts of the market looked fragile.

Analysts also pointed to reports of Trump tapping Senator

Marco Rubio to be his secretary of state, arguably one of the

most hawkish options.

"The market is now worrying that there will be more rapid

negative China policy emerging from the Trump administration

with his new cabinet picks," said Steven Leung, executive

director of institutional sales at UOB Kay Hian in Hong Kong.

"Their hawkishness could be more than expected."

Data provider DDHQ projected on Monday that Trump's

Republican Party had won a majority in the U.S. House of

Representatives, signalling a majority for Republicans in both

chambers of Congress.

Trump's victory and the election of pro-crypto candidates to

Congress have supercharged a bitcoin rally to record

highs close to $90,000, with $100,000 seeming possible. It was

last at $88,516.

"It's been supported by the fact that Trump and the new

Congress appear more friendly to crypto," Deutsche Bank

strategist Jim Reid said.

On the macro side, there is U.S. consumer price inflation

data on Wednesday and a parade of Federal Reserve speakers also

due to speak this week, including Fed Chair Jerome Powell on

Thursday.

Markets are pricing in an 87% chance of the Fed cutting

rates in December by 25 basis points.

In commodities, oil struggled to gain a foothold, having

dropped in recent days, as traders weigh up the impact of

China's stimulus plan against oversupply concerns.

Brent crude futures were last up 0.7% at $72.32 a

barrel, while U.S. futures were at $68.52, also up 0.7%.

Spot gold fell 1% to around $2,591 an ounce, its

lowest in a month.

(Additional reporting by Ankur Banerjee in Singapore and

Jiaxing Li in Hong Kong; Editing by Christian Schmollinger, Shri

Navaratnam and Kevin Liffey)