Donald Trump’s victory caused a whirlwind on world markets this Wednesday, causing the dollar, bitcoin, American stocks and rates to jump when European stock indices ended in the red.
The New York Stock Exchange closed with fanfare, after Donald Trump’s victory in the US presidential election, which propelled its three star indices to new records. The Dow Jones jumped 3.57%, the Nasdaq index 2.95% and the broader S&P 500 index 2.53%. Bitcoin also reached a historic high, exceeding $75,000 for the first time.
The election of the Republican candidate also propelled a certain number of assets, such as the action of the Tesla group (+12.97% around 4:45 p.m. local time), owned by Elon Musk, active support of Donald Trump. American oil stocks also gained ground when groups specializing in renewable energies declined.
In Europe, Frankfurt (-1.13%), Milan (-1.54%) and London (-0.07%) finished in the red after a complete reversal of the trend. The CAC 40 in Paris even briefly jumped by more than 2% at the start of the session before ending down 0.51%.
And for good reason: European investors know that if the Republican’s program is implemented, it could be devastating for Europe, with risks to growth and inflation. The next president wants to increase import taxes to between 10 and 20% for all products entering the United States, and up to 60% for those coming from China, or even 200% for certain types of goods.
Soaring rates, soaring dollar and historic peak for bitcoin
On the bond market, the interest rate on 10-year US government bonds jumped to 4.46% around 4:45 p.m. this Wednesday, compared to 4.27% at the close on Tuesday. That with a two-year maturity rose to 4.28%. The shares of American banks are particularly celebrating, driven by the surge in borrowing rates. JP Morgan thus jumped by 9.66%, Bank of America by 7.50%, Citigroup by 8.81%, Goldman Sachs by 12.38% and Wells Fargo by 13.85%.
The dollar also soared in the wake of the Republican candidate’s victory. Against the euro, the greenback even briefly soared by more than 2%, a particularly significant variation for the foreign exchange market. The Dollar Index, which compares the American currency to a basket of currencies, reached a peak this Wednesday since the beginning of July, at more than 105 points.
For its part, bitcoin exceeded the $75,000 mark for the very first time this Wednesday, boosted by the prospect of regulatory relaxation and tax measures favoring the cryptocurrency sector. The first digital currency gained 7.69%, to $74,483.26 around 4:45 p.m. local time, shortly after reaching a new all-time high at $75,371.67.
Concerns over raw materials
The return of Donald Trump to the White House also revives concerns for American soybeans, whose prices fell this Wednesday, in an uncertain market facing a potential escalation of trade tensions with China, the main destination for American oilseeds. Oil is also hesitant in the face of Trump’s victory, with the rise in the greenback weighing on demand for crude.
Furthermore, a trade war with China, the leading importer of black gold, could worsen the slowdown in oil demand.
