Russia's rouble suffered on Thursday while China's yuan and emerging market stocks scaled multi-year highs as Joe Biden moved closer to victory in a tight US election race.
Democrats are unlikely to win the Senate, however, and markets were trying to assess the implications of a potential US policy gridlock.
Developing markets that might suffer from a Biden win nursed some losses. Russia's rouble slipped as much as 1.5% before paring back some losses to trade 0.2% lower against a softer dollar, with a fall in oil prices adding to the pressure.
"A potential Biden victory will prevent the rouble from benefiting from overall market sentiment," said Piotr Matys, emerging markets FX strategist at Rabobank. "This risk of the US imposing sanctions on Russia will continue to weigh."
However, Russia's rouble firmed on the Moscow Exchange which was closed for a public holiday on Wednesday.
Many other developing currencies enjoyed healthy gains. Mexico's peso - a weather vane for US trade relations - strengthened more than 1%. China's yuan hit a 28-month high as the growing prospects of a Biden presidency raised hopes of a less tense US-China trade relationship.
"Trump looks more hawkish on China and if he got another four years, his tough anti-China activities will intensify," Hao Zhou, senior economist at Commerzbank wrote in a note.
"While Biden is also likely to take a hard approach on China, the new administration might need some time to frame the new policy, which might give China some room to breathe."
South Africa's rand rose 0.3% against the dollar while Hungary's forint led gains across central European currencies with a 0.7% jump against the euro.
Many emerging market hard-currency bonds joined the rally. Mexico's longer-dated sovereign dollar bonds jumped more than 5 cents in the dollar to multi-month highs, with bonds in other developing economies adding to Wednesday's gains.
The Czech crown edged up against the euro ahead of a central bank meeting later in the day, where interest rates are likely to remain unchanged.
Emerging market stocks raced to their highest level since May 2018, with bourses in China, Russia and South Africa rising between 1% and 3%. The MSCI's index of emerging market stocks was set for its best day since July.