DOHAS: Stock markets fell yesterday as investors paused for breath following recent gains, with a long-awaited US tax cut plan moving near the finish line.
Equities have been on a broad upswing since last week when holdout Republican senators said they would back President Donald Trump’s signature tax legislation.
Despite the expected passage of the bill, stocks prices on the Wall Street were treading water yesterday, taking a breather after a series of recent record closes.
‘With equity markets having risen more than 25% since Trump’s election victory, at least in part due to his tax reform plans, it’s likely that this is almost entirely priced in at this point, said Oanda analyst, Craig Erlam. ‘It will be interesting to see whether the rally can now be maintained until the end of the year, or whether the Santa rally will instead grind to a premature halt as investors lock in some profits.
IG analyst Chris Beauchamp also felt it was no surprise ‘that markets are not exactly going crazy with excitement, since all the fun had been priced in. Expectations that the massive reduction in corporate taxes would boost company profits had previously helped fuel a surge in global equities.
The unit, which hit a record peak of $19,500 at the start of the week, took a hit as it emerged that Youbit had been hacked, leading the firm to say it would close and enter bankruptcy.
Also on Tuesday, US authorities suspended trading in a popular bitcoin-related stock, citing concerns about market manipulation.
The Crypto Company’s share price had risen 1,700% between the end of September and Monday evening before the Securities and Exchange Commission intervened to halt trades until January 4.
Bitcoin has soared almost 30-fold since the start of the year and this month saw it move into the mainstream as two major US exchanges began trading futures in the unit.