While Covid cases continue to rise and countries around the world extend or impose stricter lockdowns, investors still turned risk-on yesterday. The S&P and Nasdaq were up 0.7% and 1.2%, respectively. As you would expect, treasuries were sold, pushing the 10-year yield back to 0.95%. The dollar keeps losing value as the index falls to multi-year lows. Conversely, gold continues to rise, currently closing at $1,950.
With the democrats winning not only the Senate, but also the whole Congress, certifying the electoral college results, cohorts of Trump supporters travelled to downtown Washington to protest. However, markets weren’t affected by the tense situation. The S&P is up 1% and treasuries were sold en masse, pushing the 10-year yield above 1% (the first time since before March of last year). Gold took a breather and pulled back, currently at $1,920.
With rising concerns over the new coronavirus strain and the feeling that vaccines might not arrive soon enough, investors are behaving risk-off. Both the S&P and the Nasdaq were down almost 2%, and treasuries were bought. The dollar, which continues to fall, bounced quickly. Gold rose higher still, now at $1,945.
It feels a bit silly to talk about traditional markets when the crypto space outperforms by so much. Since the last morning update, on the 30th of December, a lot has happened. Sure, the S&P and the Nasdaq are up, treasuries are up and the dollar is down but all of them by marginal amounts. Maybe gold is the good surprise, back above $1,900 after a number of ‘up’ days.
Yesterday, we saw the return of the dollar and treasuries against equities and gold. While markets welcomed the resolution in the US stimulus bill, the new coronavirus strain reported in the UK (and the ensuing lockdowns) dampened some of the enthusiasm.
Macro and Crypto Markets