In a surprise turn of events, US President Donald Trump took to Twitter to extol the virtues of ongoing trade talks with China, sending shockwaves through the global financial markets.
Trump Lauds Progress in US-China Trade Talks, US Equities Maintain Strong Uptrend
In a surprise turn of events, US President Donald Trump took to Twitter yesterday to extol the virtues of ongoing trade talks with China, sending shockwaves through the global financial markets. The sudden shift in tone from the White House triggered a rally in the US stock market, with major indices firmly higher, while the USD/JPY currency pair also responded positively to the news.
Boost for the US Equity Market
The morning after Trump’s tweet, the US equity market opened with a vengeance. The Dow Jones Industrial Average (DJIA) leapt higher, with the index posting its biggest daily gain in over two months. The S&P 500 and the Nasdaq Composite also joined the party, with both indices surging to record highs. The sudden surge in investor confidence was seen as a direct result of Trump’s endorsement of the trade talks, with many market participants believing that the White House’s increased optimism would ultimately lead to a more favorable trade agreement.
USD/JPY Currency Pair Sees Boost
The sudden injection of optimism into the market had a ripple effect on the currency markets, with the USD/JPY currency pair gaining significant ground. The pair, which had been trending lower in recent days, staged a dramatic turnaround, advancing over 100 pips in a matter of hours. This sharp increase in demand for the US dollar sent the currency pair to its highest levels in over a week.
Bitcoin Continues its Ascent
Meanwhile, in the world of cryptocurrencies, Bitcoin continued its meteoric rise, surging to its highest levels in over two months. The digital currency, which had been trading in a tight range for several days, suddenly broke free, gaining over 5% in a matter of hours. The recent surge in Bitcoin’s value is largely attributed to its growing sentiment as a safe-haven asset, with investors seeking refuge from the market volatility emanating from the US-China trade tensions.
