Asian stock markets are volatile as the US election results so far indicate a tight race for the presidency.

Asian markets are the only ones trading as the polls come in. In early trade, Japan's Nikkei 225 was 1% higher while Australia's ASX 200 and South Korea's Kospi were both 0.3% up.

Hong Kong's Hang Seng opened 1% lower while the Shanghai Composite was flat.

Earlier Wall Street and European markets closed higher, but the gains were small suggesting caution.

The Mexican peso has seen some of the most notable fluctuations, swinging wildly against the dollar, despite surging to a two-month high earlier.

The Mexican currency's movements are seen by many in the market as a good indicator of the election's likely outcome, with an upward movement suggesting Hillary Clinton is ahead.

Image copyright Reuters

Mexico is expected to suffer should Mr Trump be elected because of his pledges to build a wall along the US border with the country and renegotiate their trade agreement.

In Europe, London's FTSE 100 and stock markets in Paris and Frankfurt all made small gains of between 0.2% and 0.5%, while in the US the three main stock indexes jumped between 0.4% to 0.5%.

Volatility ahead

Analysts said the number of shares being traded was lower than normal, indicating investors are still uncertain about the result.

"2016 has been a year full of surprises. Don't forget the markets priced in a Remain win in the Brexit referendum and got it wrong," said Nigel Green, chief executive of deVere Group.

He warned a victory for Mr Trump could deliver a "double whammy negative impact" on global markets because they are expecting Mrs Clinton to win.

Image copyright PA Image caption Market movements suggest traders expect Hillary Clinton to win the election

"Should she win, global financial markets will react favourably as she is seen to represent the status quo, whereas Trump is much more of an unknown and therefore will create uncertainty and the markets will react accordingly," he said.

Major banks have told clients to expect sharp movements in currency markets, and are reported to have put extra staff on duty throughout the night.

The cost of protecting against sharp movements in currencies such as the Mexican peso and the US dollar rose suggesting investors were expecting volatility as the results come in.

"It doesn't take much in order to move the prices," said Peter Jankovskis, co-chief investment officer at OakBrook Investments.