General Meeting Market Update Jan. 29

Market Update:

Overview: The first week after President Donald Trump’s Inauguration 

  • US quarterly GDP has been dragged greatly because of the Net Export 


—Growing optimism:

–Background: Trump’s proposed policies:

–Lower taxes

–Stronger job markets

Consequence: Consumer Spending (70%) rose 2.5%; purchase added 1.7% point to growth; Investment and Housing improved. Investment on equipment rose at 3.1% and residential construction jumped at 10.2%.

US Stock Market: Stocks:

  • S&P500 Index finished its 0.2 percent from its record set last Wednesday
  • Greenback capped fifth weekly slide
  • The yen weakened as Japan’s central bank stepped in to buy debts.
  • 10-year treasury yields fell below 2.5%
  • Gold has headed for its longest slump in 3 months
  • Although GDP reports gave little reasons for investors to invest more dollars in the market, strong job market and growth optimism make investors keep adding money in.
  • Stocks:
    The S&P 500 slipped 0.1 percent to 2,294.50 at 4 p.m. in New York. It rose 1 percent in the week and closed Wednesday at a record.
    The Stoxx Europe 600 fell 0.4 percent following three days of gains. The measure rose 1.1 percent in the week.
  • Currencies:
    Dollar Spot rate fell by 0.1%
    The pound slipped 0.3 percent, paring its gain in the week to 1.4 percent weekly gain. The yen slid 0.5 percent and the euro was little changed.
  • Bonds:
    The yield on 10-year U.S. Treasuries fell two basis points to 2.48 percent.
    German bonds due in a decade halted a three-day slide, pushing the yield to 0.46 percent.
    Japanese 10-year yields were little changed at 0.08 percent. The BOJ boosted the amount of 5-to-10-year bonds it buys in its outright purchase operations, underscoring a commitment to keep its yield-curve target.
  • Commodities:
    Gold futures fell 0.1 percent to settle at $1,191.10 an ounce, the lowest price in two weeks.

    Trump, Immigration and Tech

  • —Background:
    President Donald Trump’s sudden executive order on immigration on Saturday—Responds from Tech leaders:
    Netflix Inc Chief Executive Reed Hastings: “It is time to link arms together to protect American values of freedom and opportunity.”

    Apple Inc CEO Tim Cook: “not a policy we support” and promised to help affected employees; “We have reached out to the White House to explain the negative effect on our coworkers and our company,”

    —Consequences: Stranded
    Leave employees from tech companies potentially stranded overseas and unable to return back to the US

    –>Alphabet Inc’s Google urgently called back employees from overseas and told ones who might be affected by the ban not to leave the United States.