Powerful increases on Wall Street. Dollar up, gold down

Reports of the de -escalation of the trade war between Washington and Beijing caused panic shopping of the Wall Street campaign. At the same time, he gained a dollar, lost their bonds of the US government strongly and gold was tightly. In one sentence: it happened.

The NASDAQ Composite index ended with a 4.35% increase in Monday and at 18,708.34 points. It was the highest closing course from the end of February. The S&PLE increased by 3.26%, climbing to a height of 5,844.20 points. Dow Jones gained 2.81%, finishing with a result of 42 410.10 points.

The values ​​of great technology companies increased the most. Microsoft's shares gained 2.4%, Nvidia over 5%, finishing nearly 8%, and Amazon 8.1%. But the greenery flooded almost all sectors of the American stock market, and the shares of banks up to 3-5%. Looking at the coldly, it resulted in panic of buying from those investors who were not posted on the arrival of good information from the front of customs wars.

And good news came in this field during the weekend. The United States and China agreed to reduce their duties on mutual import by 115 points. percentage from May 14 for 90 days – it was announced in a joint statement of both governments after ministerial talks in Geneva. This is a great progress compared to the condition from the weekend, when both countries covered their commercial exchange with prohibitive duties, reaching over 100% of the value of imported goods. Extending such a state of affairs threatened with a complete collapse in mutual trade and breaking the complex supply chains.

It seems that even such temporary agreement surprised many market participants, who in March and early April deposited their wallets for global recession and escalation of commercial wars. This is also evidenced by high variability in other segments of financial markets.

Let's start with the debt market, where the profitability of American treasury bonds went up after about 10 PB. Virtually all the duration of the term curve: from 2-year-olds to 10-hundred papers. This is a bit of an ambivalent signal. On the one hand, it may indicate the belief that a serious recession will be avoided. On the other hand, this is difficult to consider as a manifestation of trust in the state of public finance Uisa.

He gained the American dollar strongly. The EUR/USD exchange rate dropped from over 1.12 to 1.1090. Daily recourse by 1.5% on the main currency pair in the world is really a lot. Just like a 3 % discount of gold, which is in recent weeks and months the chief “safe marinade” for global capital. In all this you can see definite changes in investor portfolios: escape from security in favor of risky assets in the accompaniment of a stronger dollar.

– This is a textbook relaxation after the waterfall from early April. The market breaks through the levels of resistance and this is a great victory for Trump, for action and investors – commented Gina Bolvin from Bolvin Wealth Management Group cited by the Reuters agency.

However, some analysts are cooling optimism currently on financial markets. They remind you that American duties on Chinese goods will continue to be a considerable 30%, which can cause a strong inflationary impulse in the USA. Secondly, all agreements are temporary, and any permanent decisions are still like medicine. And finally, thirdly, both the American consumer and American business cannot be sure of the future, and the chaotic policy performed by President Trump will rather remain with us until the end of the term.

KK

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