Stocks stable as Trump returns to office
President Trump returned to the White House yesterday evening as he was discharged from the hospital a few days after contracting the coronavirus. The news saw markets stabilize after a few choppy trading sessions.
This came despite quotes from Fed Chair Jerome Powell that the U.S. economic recovery could head into a downward spiral if the coronavirus is not effectively contained.
Regarding the Fed’s contribution, he stated that, “Too little support would lead to a weak recovery, creating unnecessary hardship for households and businesses”.
As of writing, the Dow was up 0.27%, S&P 500 gained 0.22%, however the NASDAQ Composite was down less than 0.05%
IMF warns of “long, hard” recovery
International Monetary Fund Managing Director Kristalina Georgieva stated that although the global economy is in better shape than at the height of the COVID-19 outbreak, more needs to be done to prevent further catastrophes.
Speaking to an online audience at the London School of Economics, Georgieva stated, “this calamity is far from over. All countries are now facing what I would call ‘the long ascent’ – a difficult climb that will be long, uneven, and uncertain. And prone to setbacks”.
She added that markets risk crashing if governments begin to slow down monetary support.
FCA bans Cryptocurrency trading
The Financial Conduct Authority (FCA) announced that it will ban the trading of crypto-derivatives for retail traders, effective January 6th, 2021. The decision is said to also include ETNs (Exchange Traded Notes) as well as CFD’s (Contracts for Difference).
Speculation about this had circulated the rumour mill for the last 12 months, and the FCA is quoted as saying that by implementing the ban, retail customers will avoid close to £50 million in annual losses from trading these products.
Bitcoin was unmoved by the news, and currently trades at $10,728, which is close to where it started the day.
Quote of the day – “In the short run, the market is a voting machine, but in the long run it is a weighing machine.”Benjamin Graham
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Senior Market Analyst