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Executives world-wide returned to work Wednesday to face a radically changed political landscape as they weighed the ramifications of Donald Trump's surprise election win—the second big shift for global businesses in recent months after the U.K.'s Brexit vote.

The upset victory by the Republican nominee, who was down in most polls heading into Election Day, took markets and many corporate leaders by surprise—and will leave them unsettled, given the uncertainty behind many of Mr. Trump's policy positions. Shares of auto makers and some industrial conglomerates fell early Wednesday, while pharmaceutical companies, some energy firms and bank stocks rose.

"The market wanted the certainty and clarity of a Clinton win—it may not agree with all of her policy proposals, but it was comfortable with gridlock," said Brian Gardner, head of Washington research for the investment bank Keefe, Bruyette Woods.

Mr. Trump has criticized global trade, the North American Free Trade Agreement and the Trans-Pacific Partnership, a trade agreement to lower or eliminate tariffs between the U.S. and 11 other countries including Japan and Vietnam.

Any push by the Trump administration to craft new bilateral agreements is a potential headache for firms such as General Electric Co. and Caterpillar Inc. that have supported free trade as a way to gain access to overseas markets, analysts said.

"Obviously we are concerned about the antitrade rhetoric, a lot of the antibusiness positions and it's very worrisome," FedEx Corp. CEO Fred Smith said of both candidates in a recent earnings call. "But hopefully, after the election cooler heads will prevail."

Global stock markets fell sharply overnight, but the Dow industrials were largely unchanged, up 0.8% to 18347.86 shortly after trading opened. The dollar initially sold off against the euro, yen and sterling in Asian trading but recouped much of those losses.

In Asia, shares fell sharply in Japanese and South Korean auto makers such as Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co., which lean heavily on manufacturing U.S.-bound exports from Mexico. On the campaign trail, Mr. Trump criticized big U.S. companies like Ford Motor Co. and United Technologies Corp. for moving jobs and operations overseas. He threatened to slap 35% tariffs on cars imported from Mexico.

For many investors and executives, a victory by Hillary Clinton was expected to provide more immediate clarity despite her targeting big businesses on the campaign trail—including pharmaceuticals firms—as ripe for scrutiny.

Big drug stocks shot higher in Europe after being weighed down for months by the prospect of a pricing crackdown during a Clinton presidency. And U.S. defense stocks rallied early as the prospect of a short-term bump in military spending from the incoming Trump administration outweighed concerns about a possible hit to export sales.

Mr. Trump has vowed to dismantle the Affordable Care Act—a move that could hinge on Democrats' ability to block legislation in the Senate—and to allow health insurers, which currently are regulated by the states, the ability to compete across state lines. Either has the potential to upend the U.S. health-insurance market, which is still coming to grips with the changes wrought by the ACA.

Mr. Trump's election promises relief for U.S. coal miners, a boost for American oil producers and fresh uncertainty for Western energy companies' plans to return to Iran.

Whether any of the market moves early Wednesday end up being knee-jerk reactions, or early signals of which global sectors may benefit from a Trump presidency, is far from clear. Many of Mr. Trump's policy statements so far have been vague and open to interpretation, and he has been known to swerve on positions radically.

After the election result, more than 1,100 chief executives said in an open letter to Mr. Trump that he can count on business to promote "healing and reconciliation."

"To be sure, we are aware that there will be times when we disagree on the specifics of important policies, and we will respectfully make our voices heard when we do," they wrote. "We do believe, however, that we can be constructive—both when we agree and when we do not—if we can all approach challenging situations in good faith, guided by an unwavering commitment to a greater purpose."

The letter was organized by the National Association of Manufacturers, a major Washington trade group. The signers include Dennis A. Muilenburg of Boeing Co., Wes Bush, CEO of Northrop Grumman Corp., David Taylor, CEO of Procter Gamble Co. and Gregory Hayes of United Technologies Corp.

Mr. Trump has proposed overhauling U.S. corporate taxes by reducing the corporate rate to 15% from 35%. His plan also provides for a one-time tax rate of 10% for repatriated corporate profits, which would help fund plans to spend on new infrastructure projects.

Mr. Trump's campaign argues that in addition to forestalling inversions—acquisitions that enable companies to re-domicile abroad—the plan would accelerate U.S. economic growth.

"His view is if you lower the tax rate at the corporate level, more money is coming back into the country," said Scott Kaplowitch, a partner at Edelstein Company LLP. "You would think twice about investing overseas if the tax rate came down in the U.S."

Mr. Trump has spoken out against media consolidation, saying his administration would seek to block AT&T Inc.'s proposed $85 billion acquisition of Time Warner Inc. "It's too much concentration of power in the hands of too few," he said in October. Shares of Time Warner fell 1.5% to $86.45 early Wednesday, while AT&T shares were up 0.4% at $37.15.

Alex MacDonald contributed to this article.

Write to Theo Francis at theo.francis@wsj.com, Denise Roland at Denise.Roland@wsj.com, Andrew Tangel at Andrew.Tangel@wsj.com and Sean McLain at sean.mclain@wsj.com

(END) Dow Jones Newswires

November 09, 2016 10:55 ET (15:55 GMT)

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