|
Time running out to avoid shutdown, cryptocurrencies plunge, and the dollar regains some ground.
|
Getting tight
Republican leaders are struggling to get agreement on a funding bill that will avoid a government shutdown on Friday after President Donald Trump and Democratic lawmakers seem to move further apart on a deal that would shield young undocumented immigrants from deportation. GOP lawmakers are weighing another short-term measure, which would extend funding to Feb. 16, according to a person familiar with the negotiations.
Crypto crash
It’s an ugly session for investors in digital currencies, with all of the major tokens suffering large reversals this morning. Bitcoin saw an almost 20 percent decline, dropping as low as $11,199, while ethereum and litecoin plunged more than 20 percent. While there is no obvious driver for this morning’s moves, yesterday Bloomberg reported that China was escalating its crackdown on trading in the digital ‘assets’ while South Korea’s finance minister repeated it may ban local cryptocurrency exchanges.
Dollar uptick
The greenback extended a four-day decline during yesterday’s U.S. holiday, weakening against every major currency with Bloomberg’s dollar index approached its lowest levelin three years. That trend is seeing a modest reversal this morning as the dollar regains some of the ground lost in recent sessions, trading at $1.2212 to the euro and $1.3749 to the pound. Investors are also keeping an eye on the yuan, which has risen to the highest level in two years amid speculation authorities in China may introduce new measures to cool currency gains.
Markets rise
Overnight, the MSCI Asia Pacific Index added 0.5 percent, while Japan’s Topix index closed 0.6 percent higher and the Hang Seng Index climbed 1.8 percent to a record high. In Europe, the Stoxx 600 Index was 0.5 percent higher at 5:45 a.m. Eastern Time as earnings season kicks off in the region. S&P 500 futures added 0.5 percent, the 10-year Treasury yield was at 2.524 percent and gold was lower.
U.K. outlook
There was an improvement in the inflation reading for the U.K. this morning when December data showed a slight decline to 3 percent from the previous month’s 3.1 percent. Respondents to a Bloomberg survey showed little optimism for British growth prospects, with a median forecast for a 1.4 percent expansion both this year and next. The main driver of the economic outlook remains the Brexit negotiations, with JPMorgan Chase & Co. flagging a “non-negligible risk” that talks with the EU collapse as it remains bearish on the pound.
|
Here's what you should read today |
|
| |||
Facebook fell nearly 5 percent on Friday after Mark Zuckerberg announced his plan to blow the company up from the inside, as Gadfly's Shira Ovide put it. Basically, the strategy is to make Facebook more about personal connections, and less about outside news and brands, something which is obviously a source of concern to investors. But should they be fearful? Some analysts are already speculating that advertisers will now pay up even more to get on the site, since the changes will make user attention more scarce. The question we should be asking is whether Facebook can slow its business down even if it wants to. This is one of the defining questions of our time. We live in a world dominated by huge networks that demonstrate incredible economies of scale, growing in power as they expand. Facebook and Amazon are good examples, as is Vanguard in finance. Global megacities like Los Angeles, New York City, and London are also important cases: geographic networks whose economies power ahead as their size turns into strength, drawing more and more activity inward. It remains to be seen whether marginal changes will affect this dynamic. Will Brexit actually derail London? Will the elimination of the SALT deduction matter to New York City? Will Mark Zuckerberg's change of heart affect Facebook's bottom line for even one quarter? Stay tuned to find out.
 |
No comments:
Post a Comment