Us Shares, Bitcoin Hit Record High And Dollar Soars On Trump Win

Us Shares, Bitcoin Hit Record High And Dollar Soars On Trump Win

New York – November 9, 2016 – Global financial markets soared on Wednesday after Republican candidate Donald Trump was declared the winner of the US presidential election, sending the dollar to a 14-year high against the yen and helping stocks and crude oil rally.

Background

Prior to the election, markets had been roiled by fears that a Trump victory could lead to increased economic uncertainty and perhaps even recession. But the market’s reaction on Wednesday suggested that investors were betting that a Trump presidency would be good for business, thanks to his promises of tax cuts and deregulation.

Key Facts and Latest Updates

The Dow Jones Industrial Average jumped nearly 250 points, or 1.4%, to close at 18,522.65. The broader S&P 500 index gained 1.6% to 2,163.29. The Nasdaq Composite Index climbed 1.9% to 5,311.32. Also, Bitcoin Price rocketed to US$7,888 per coin, before settling below US$7,500, up approximately 6%.

“The market is clearly relieved that the election is over, and that Trump won,” said Bill Stone, chief investment officer at Avalon Wealth Management in New York, in an interview with Bloomberg. “The market is betting that Trump will be good for the economy.”

The US dollar also surged, with the euro falling to a 14-year low against the greenback. The dollar also hit a seven-month high against the Japanese yen.

“The dollar is strengthening because investors are expecting Trump to implement policies that will boost the US economy, such as tax cuts and infrastructure spending,” said Kathy Lien, managing director of FX strategy at BK Asset Management, in an interview with Reuters.

Analysis or Impact

Analysts said the market’s reaction to Trump’s victory was a sign of confidence in his ability to implement his economic policies. However, they also cautioned that it was too early to say what the long-term impact of a Trump presidency would be.

“The market is betting that Trump will be good for the economy, but it is still too early to say for sure what his policies will be,” said Stone. “We need to wait and see what he does in office.”

Last Words

Despite the strong market rally, some warned that the market could be in for a correction if Trump’s policies do not live up to expectations.

“The market is pricing in a lot of good news right now,” said Lien. “If Trump’s policies don’t deliver, the market could sell off.”