The Democratic candidate’s victory at the US Presidential election was largely priced in by markets, which had been trading with the view of a Biden presidency and a Republican-controlled US Senate late last week.

E-mini futures for the S&P 500 jumped 0.6 percent on Monday, signalling a positive start for US markets.

MSCI's broadest index of Asia Pacific shares outside of Japan inched up 0.1 percent, after climbing 6.2 percent last week to clock its best weekly performance since early June.

“What appears to be divided government at this point provides more continuity of the current environment rather than the potential for wide-sweeping changes,” said wealth manager Jim Wilding at Confluence Financial Partners in Pennsylvania.

“We view this is as a net positive for equity markets, particularly in this scenario given it puts the odds of higher taxes very low in the years to come,” he added.

Wilding added a word of caution though with the S&P 500 not far from all-time highs.

“While we remain positive over the intermediate term outlook and believe divided government reduces the chances of a bear case scenario playing out, we would refrain from unbridled enthusiasm at current levels,” Wilding said.

Equities rallied hard last week, with the S&P500 up 7.3 percent, clocking the best gains in an election week since 1932, according to National Australia Bank analyst Tapas Strickland.

Matt Sherwood of Australian fund manager Perpetual, however, said Biden’s victory did not necessarily warrant a tweaking of his portfolio.

“In the end we think the US economy is still fairly fragile and growth’s slowing down,” Sherwood said.

“You could potentially gravitate your portfolio more towards higher-beta type markets, such as emerging markets, and there is potential for better prospects in the energy space than would have been the case with a Democrat clean sweep.”

Analysts also warned the road might get tougher from here as investors focus on Biden’s ability to expand fiscal stimulus and measures to reduce the spread of COVID-19.

The United States saw a record number of new coronavirus infections last week, with the total number of cases nearing 10 million.

A fiscal stimulus plan is still possible despite a divided government, analysts said, though a larger package is less likely. That puts the spotlight on the US Federal Reserve to do more to bolster the world’s largest economy.

As a result, the dollar has weakened in recent days while growth proxies such as the Australian dollar have rallied with the Biden presidency seen less likely to be confrontational on trade.

The dollar was a shade weaker against the Japanese yen at 103.25, after slipping about 1.3 percent last week.

The Aussie was up 0.3 percent, having jumped 3.3 percent last week.

Investor focus will also be on sterling and the euro this week with UK-EU trade negotiations coming to a head with the EU summit on Nov. 15.

Later in the day, the Bank of England chief economist will give a speech on ‘The economic impact of coronavirus and long term implications for the UK’.

The euro, which climbed 1.9 percent last week, was a shade higher on Monday at US$1.1887. Sterling was a shade weaker at $1.3146.

That left the dollar index off 0.1 percent.

In commodities, oil prices ticked up a bit after losses on Friday but stayed below $40 a barrel as rising global coronavirus cases stoked fears about lacklustre demand.

Gold climbed, with spot prices up 0.36 percent at 1,958.7 an ounce.

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