US stocks surged to record highs, while the dollar and Bitcoin also posted impressive gains after Donald Trump’s unexpected re-election victory, marking a significant turning point in the global markets. As Wall Street celebrated the political shift, investors were betting that Trump’s fiscal policies would ignite growth despite concerns over inflationary pressures.
Wall Street Rallies, Dollar Soars to New Heights
The major US stock indexes closed at new peaks, with bank stocks leading the charge. The dollar surged by approximately 1.65% against a basket of global currencies, including the pound, euro, and yen. The British pound dropped by 1.16% against the US dollar, hitting its lowest point since August. The euro also faced a significant setback, falling 1.89% against the dollar. Meanwhile, the Japanese Nikkei 225 index ended the session up by 2.6%, and European markets saw mixed results with the German DAX and French CAC 40 closing in the red.
Bitcoin Breaks Records Amid Political Shifts
Bitcoin reached an all-time high, briefly touching $75,999.04, a jump of more than $6,600. The cryptocurrency surge is largely attributed to Trump’s commitment to making the US the “Bitcoin superpower of the world.” Unlike the Biden administration’s crackdown on crypto firms, Trump has pledged to create a more favorable environment for digital currencies. His stance is already having a ripple effect, with major backers like Tesla’s Elon Musk reaffirming support. Musk’s Tesla shares surged over 14%, marking a two-year high, fueled by Musk’s public endorsement of Trump and Bitcoin.
Global Reactions to Trump’s Trade Policies
Despite the market’s enthusiasm, Trump’s economic policies are raising concerns, particularly in global trade. His proposals to increase tariffs, especially on China, are seen as a potential economic shock. Economists have warned that such policies could slow growth in countries like the UK and the EU. Chancellor Rachel Reeves of the UK emphasized the importance of free and open trade, cautioning against protectionist measures that could undermine global economic stability.
Looking Ahead: Focus on Inflation and Interest Rates
With inflation concerns rising, investors are closely watching the Federal Reserve’s next move. Trump’s tax cuts and tariffs are expected to increase inflation, prompting speculation about prolonged high interest rates. Jerome Powell, the Fed chair, will soon provide clarity on monetary policy, a key factor influencing global markets in the coming months.
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