Gold Slides After Rollercoaster US Market Week
Stocks conclude inconsistently in the U.S., following a turbulent journey
After a week of wild swings on Wall Street, even gold couldn't escape the fallout. Here's the lowdown on what happened and what you need to know.
Although US markets managed to partially recover from the hostile start of the week, they were still left battered and bruised by Monday's close. The Dow Jones Index plummeted by 0.9% to 37,966 points, with the S&P 500 dropping 0.2%. Meanwhile, the Nasdaq indices saw a slight recovery, credited to investors shrewdly taking advantage of the restive tech sector's steep losses.
The modest market rebound was ignited by some hopeful words from Kevin Hassett, Director of the National Economic Council. He hinted that President Trump might be considering delaying the escalating tariffs he announced last week. However, this notion was swiftly squashed, leading the indices to significantly decrease their losses.
Interestingly, despite the ~up and down~ market action, there was a willingness to negotiate on the US side. Later on, US Treasury Secretary Steven Mnuchin revealed that Trump had asked him to discuss potential tariff negotiations with Japanese Prime Minister Shinzo Abe. Trump himself expressed a desire to secure deals on tariffs with some nations, but reaffirmed his commitment to his original plan.
Major players in the financial community, such as prominent hedge fund managers and heads of leading US banks, are growing increasingly wary of Trump's policies. Bill Ackman, founder of Pershing Square and an active investor, even called for a delay in the tariffs. Even Jamie Dimon, CEO of JPMorgan, cautioned that these trade disputes could harm allies and weaken the US economy.
Gold in the Roulette Wheel of Market Chaos
While fears of a global trade war continued to loom over markets, concerns about rising inflation rates hinder central banks' ability to counter with monetary easing. Last Friday, Fed Chair Powell warned that the US economy could transition into a period of higher prices and slower growth that was unthinkable only a few weeks ago. However, he also signaled that the Fed might continue holding its ground on further rate cuts.
As investors bet that the Fed will cut interest rates aggressively in the coming months, the likelihood of a rate cut at the next meeting in May has increased to over 40%. This is a dramatic shift from just 14% a week ago. Prices now also suggest that there could be four interest rate cuts by the end of the year, an increase from the three quarter-point cuts expected last week.
On the other hand, the gold price experienced a two-percent dip below the $3,000 mark after some healthy profit-taking. Gold, which is often pursued as a safe haven in times of crisis, has proved to be an intriguing exception to the rule at times, sliding alongside stocks instead of rising.
Tune in for more market updates.
Sources: ntv.de, ino/DJ
- Economy
- Market Volatility
- Tariffs
- Wall Street
- Gold as Safe Haven
- In light of the US markets' volatile state and the escalating tariff concerns, prominent figures like Bill Ackman and Jamie Dimon have expressed their rebuke against certain employment policies and community policies, fearing potential harm to the economy.
- As a result of increased speculation about interest rate cuts and tariff negotiations, the government's employment policy and market policies might significantly impact the employment landscape and market trends, particularly in regions like the 1040 area.
- In the aftermath of the market chaos, gold has proven to be an unusual safe haven; instead of rising, it hasslipped below the $3,000 mark due to some profit-taking, and its performance might be potentially influenced by WhatsApp discussions among major financial players.
