Trump-related volatility is back
|Stocks surged and the dollar slumped on the first headlines of the new Trump administration, reminding investors that presidential-induced volatility is back, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.
Tariff headlines send Dollar reeling
He isn’t even officially president yet, but Donald Trump’s second term has got off to a volatile start for global markets. The dollar was sent flying after indications that tariffs would not be on the agenda for day one, tempering some of the wild expectations that have been flying around dealing rooms in recent days. Stocks were given a lift on the news, with Chinese futures given a notable lift, on hopes that the administration might not opt to go all out on new tariffs in the opening days of the new presidency.
The shape of things to come?
But today’s headlines certainly put a marker down – we are back to the trading conditions that prevailed in Trump’s first term, i.e. rapid and dramatic reactions to headlines and tweets. Traders have largely gotten out of the habit of responding to such developments, but once again they will need to make sure the presidential social media feeds are always just a click away.
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