US stock markets and Bitcoin reached new record highs after Donald Trump’s unexpected re-election victory, with the dollar also posting its most significant gain in eight years. Investors reacted optimistically to Trump’s campaign promises, particularly his plans for tax cuts, trade tariffs, and cryptocurrency support.
Wall Street Soars Amid Optimism
All major US stock indexes surged, with banks seeing especially strong performance. The dollar surged by approximately 1.65% against a basket of global currencies, including the euro, pound, and yen. The pound fell to its lowest level since August, while the euro dropped to its lowest point since June. International stock indexes reflected the uncertainty, with the FTSE 100 closing slightly lower after initial gains, and the German DAX and French CAC 40 both declining.
In Asia, Japan’s Nikkei 225 index rose by 2.6%, while China’s Shanghai Composite closed lower by 0.1%. Hong Kong’s Hang Seng index dropped by 2.23%, reflecting mixed global market sentiment.
Bitcoin Hits an All-Time High
Bitcoin saw a meteoric rise, surging more than $6,600 to reach an all-time high of $75,999.04. Trump’s pro-cryptocurrency stance stands in stark contrast to the Biden administration’s crackdown on digital currencies. Trump’s campaign had included a pledge to make the US a global “bitcoin superpower,” and he suggested firing Gary Gensler, the chair of the Securities and Exchange Commission, who has been tough on crypto regulations.
Tesla also benefitted from the Bitcoin surge. Elon Musk, a vocal supporter of cryptocurrencies, has long been an advocate for Bitcoin and even led Tesla to invest $1.5 billion in the digital asset. Tesla’s shares jumped over 14%, reaching a two-year high.
Trade and Economic Concerns Amid Global Shifts
However, the economic impact of Trump’s trade policies remains a source of concern. His plan to impose higher tariffs, particularly on China, has raised alarm globally, especially in the UK and the eurozone. Economists warn that this could lead to slower global growth and exacerbate trade tensions.
In the UK, Chancellor Rachel Reeves expressed concern over Trump’s stance on trade, emphasizing the importance of free global trade. Analysts predict the UK’s growth could slow dramatically if Trump’s protectionist measures are implemented.
Looking Ahead: Fed Meeting and Interest Rate Decisions
With the Federal Reserve set to meet this week, all eyes are on its next decision regarding interest rates. Investors will be keen to hear comments from Jerome Powell, as any signals about the Fed’s stance on inflation and rates will likely influence global markets further.
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