The market wrapped on edge after reacting to multiple international scandals. Fresh news about Trump’s alleged connections to Russia sent U.S. stocks tumbling while the dollar reached new lows. Even though these accusations are shocking, a new terror attack in England stole the show. A horrific bombing at an Ariana Grande concert put the entire country in shock, as the pound experienced a sudden decline. The euro held steady while the yen & New Zealand dollar enjoyed surprise increases. Crude fell while gold rose, which highlighted the unpredictability of this wild market.
Market Wraps in Uncertainty Amidst Global Unrest
“Trump risk and geopolitical concern triggered by the U.K. news this morning is making the market prone to risk-aversion moves,” said Ayako Sera, a market strategist with Sumitomo Mitsui Trust Bank Ltd. in Tokyo. “The biggest thing, nevertheless, is the wariness over suspicion surrounding Trump and Russia.”
Ever since getting elected, Trump has been the center of a slew of international scandals. Out of all of them, his alleged connections to Russia have caused the most outrage. Fresh accusations claim Trump teamed up with the Director of National Intelligence Daniel Coats & NSA Director Michael Rogers. Both publicly denied any collusions between Trump’s campaign & the Russian government in March.
This possible cover up is doing more than erode trust between the government & the American people. U.S. stocks took a hit after enjoying a series of groundbreaking days. Yesterday futures on the S&P 500 fell 0.1%, which stopped the latest growth dead in its tracks. While futures took most of the damage, the underlying gauge rose 0.5% on Monday. This stopped a 1.6% increase over the last 3 days’ dead in its tracks. The sudden 180 was especially shocking since the gauge is just 0.4% short of an all-time high.
On top of affecting stocks, this fresh controversy made the dollar back pedal. The Bloomberg Dollar Spot Index was flat, putting it at its lowest level since November. Not to be outdone, the Mexican peso joined the dollar with a 0.1% loss. This sudden slide was fueled by fears that S&P Global Ratings will cut Brazil’s rating amidst fresh political controversy. New allegations have just surfaced about their new President Michel Temer, which threaten the South American nation’s international standing.
Even though investors can’t stop talking about Trump, a horrific terror attack in England is stirring up financial turmoil. Police claim at least 22 people were killed during a suicide bombing at an Ariana Grande concert. This is the worst incident on British soil since the infamous London bombings in 2005. This terrible news sent the pound on a 0.1% slide, leaving it at $1.2985. While the pound shuddered, the yen rose 0.3% to 111.01 per dollar. New Zealand outdid this sudden recovery with a 0.6% increase on their currency.
As investors pull out their hair worrying about international incidents, the market is reacting accordingly. Stocks may have slipped, but commodities are holding somewhat steady. Gold experienced a 0.1% increase, which left it at $1,262.15 an ounce. This was its 3rd day of gains, putting it on par for one of the best weeks this year. As gold enjoyed a comeback, crude fell 0.4%. This left it at $50.91 a barrel, which disappointed investors. All these conflicting reports highlight the market’s impressionability to political catastrophes. Investors are scrambling for answers, but only time will tell where the market will go.