Bitcoin Hits Record High as Asian Markets Rise Before U.S. Inauguration

Stock Market Update: Asian Shares Rise and Bitcoin Hits Record High Ahead of U.S. Inauguration

Asian shares advanced early Monday, while Bitcoin surged to an all-time high as investors looked ahead to the inauguration of President-elect Donald Trump. U.S. markets were closed for the holiday.

Bitcoin Reaches Record High

Bitcoin saw a sharp rise, reaching a peak of $109,134 early Monday, up from $99,563. Cryptocurrencies have experienced significant growth since Trump’s election, with investors betting on favorable policies for digital assets under his administration.

European Markets Gain

European markets also started the week on a positive note:

• Britain’s FTSE 100 rose 0.1%, reaching 8,515.80
• France’s CAC 40 gained 0.2%, hitting 7,729.06
• Germany’s DAX remained nearly unchanged at 20,902.00

Futures for the S&P 500 and Dow Jones Industrial Average saw a slight increase of 0.1%.

Asian Markets: Positive Movement

In Asia, several major indices showed strong gains:

• Hong Kong’s Hang Seng jumped 1.8%, reaching 19,925.81, after China’s central bank kept its key lending rates steady.
• Shanghai Composite gained 0.1%, reaching 3,244.38.
• Tokyo’s Nikkei 225 rose 1.2% to 38,902.50.
• Taiwan’s Taiex gained 0.5%.
• India’s Sensex surged 0.7%.
• Australia’s S&P/ASX 200 added 0.5%.
• South Korea’s Kospi slipped 0.1% to 2,520.05.
• Bangkok’s SET rose 0.1%.

Investor sentiment was also buoyed by positive remarks from U.S. and Chinese officials ahead of the inauguration, with both sides expressing a commitment to improving trade relations. This helped alleviate some concerns over the potential impact of increased tariffs on Chinese exports to the U.S.

Currency and Commodity Updates

• The Japanese yen strengthened against the U.S. dollar, trading at 156.17 yen, down slightly from 156.31 yen. There’s growing speculation that Japan’s central bank may raise interest rates later this week, which would likely push the yen higher.
• The euro rose to $1.0309 from $1.0281.

In the commodity markets, U.S. benchmark crude oil dropped 19 cents to $77.20 per barrel, while Brent crude slipped 23 cents to $80.56 per barrel.

U.S. Market Recap: Strong Week Despite Volatility

On Friday, U.S. markets closed strong:

• S&P 500 climbed 1%
• Dow Jones Industrial Average rose 0.8%
• Nasdaq Composite surged 1.5%

SLB led the market with stronger-than-expected profits and revenues for the end of 2024. The oilfield services company surged 6.1% after announcing a dividend increase and $2.3 billion in stock buybacks.

The “Magnificent Seven” (Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla) all saw gains, as their stock movements carry significant weight in the broader indexes due to their size. Despite concerns that these tech stocks may be overpriced, they continue to drive market performance.

Inflation, Fed Policy, and Market Fluctuations

Stocks have been fluctuating recently, as reports on U.S. inflation have forced traders to reassess expectations for Federal Reserve actions. A recent encouraging inflation report sparked optimism that the Fed may cut interest rates further in 2025, easing economic pressure and boosting investment prices. However, such cuts could also reignite inflationary concerns.

In the bond market, rising Treasury yields have pressured stock prices, particularly for high-priced tech stocks. However, lower inflation worries have brought yields down and helped stocks recover in recent days.

Wall Street continues to navigate these economic reports, with rising or falling inflation fears leading to wild swings in investor sentiment.

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