Europe’s losses only deepened as Wednesday went on, Trump’s attempts at presidential behaviour acting as a wakeup call for investors.
When a man as foolish and dangerous as Trump feels the need to start taking something seriously, despite a deep-seated wish to protect businesses at the cost of everything else, it is probably a sign that we’re in a pretty sticky situation.
And however often the markets have tried to kid themselves otherwise, we are still very much in the thick of it regarding the covid-19 crisis, especially in the United States.
That perhaps explains why the market’s reaction to Tuesday’s appearance from Trump has been to beat a retreat.
It doesn’t help that bubbling away under the surface is further diplomatic discord between the US and China – Beijing is outraged that Washington has forced China’s consulate in Houston to close down – and the ever-growing prospect of a no-deal Brexit.
Evidence of bad times came as the FTSE and pound fell in tandem. The UK index shed 0.9%, abandoning its latest assault on 6300 to slip back to 6215, while the latest Brexit headlines left sterling down 0.5% and 0.8% against the dollar and euro respectively.
The losses weren’t quite as pronounced for the DAX, which dropped 0.4%, taking the German bourse away from yesterday’s peak, but were for the CAC, which plunged 1.1%.
At the moment the Dow Jones is only set to slide 0.3% when trading starts stateside, though that could accelerate come opening time.
As for gold, it is continuing to benefit from the market-wide worry, climbing 0.9% to a fresh 9-year peak of $1858 per ounce.
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