The superstorm is causing a massive disruption to stock trading in the United States as markets remain closed, New York residents are being evacuated and insurance companies watch millions of dollars being wiped off their value in European trading.
The storm is expected to keep Wall St closed for a second day today (Wednesday NZ time) after closing yesterday due to weather for the first time in 27 years.
Craigs Investment Partners broker Chris Timms said the closures in the US created a trading hole and left many other markets around the world in a holding pattern. But markets both in New Zealand and Australia continued trading well.
"In normal circumstances, we have the United Kingdom, followed by the US and then us. We are being left in a holding pattern for a couple of days."
The trading closure was also threatening to delay IPOs of at least six companies while Facebook employees were prevented from selling shares in the social media company after a "lock-up" on trading expired, Mr Timms said.
Some companies postponed their quarterly earnings announcements and banks closed branches in the northeast while promising to waive certain fees in hurricane-threatened areas.
Disaster modelling company Equecat said the storm could cause insured losses of $US5 billion ($NZ6.1 billion) to $US10 billion and economic losses of up to $US20 billion.
Mr Timms expected financial data to be released throughout the week, including the jobs numbers due out on Friday.
President Barack Obama and Republican challenger Mitt Romney have suspended their campaigns as the eastern seaboard of the US is lashed by the storm.
Falling job seeker numbers will help Mr Obama while rising jobless figures will help Mr Romney.
Wednesday was a key trading day in the US because it marked the end of the month, when traders priced portfolios, Mr Timms said.
The market closures were causing concern to increase about the "fiscal cliff" in the US which was worth about $US600 billion, or an annual 4% of GDP, he said. It is made up mostly of tax increases worth $US440 billion and spending cuts of $US160 billion.
Of the tax increases, 50% are related to the Bush era tax cuts and about 25% to the expiry of the 2% payroll tax cut.
The most obvious difference in economic policy between the Republicans and the Democrats was their respective fiscal policies and how that affected taxation and government spending, he said. Although corporate tax came down under both parties, Mr Obama increased personal and dividend tax while retaining more social spending.
Mr Romney planned to pay for reduced headline tax rates with reduced tax deductions and reductions in federal social programmes. It was also worth noting that Mr Romney had indicated he would replace Ben Bernanke as chairman of the Federal Reserve.
"This would potentially remove the implicit underwriting provided to bond and equity markets through the central bank asset purchasing activity the Fed is undertaking.
"At face value, this is a negative for markets."
The status quo of a Democrat Senate and president, with a Republican House, would be greeted cautiously by the markets.
"With neither party in absolute control, focus would very quickly turn to the fiscal cliff and the debt ceiling," Mr Timms said.
