Global equities rocked by Trump immigration ban
london — Asian and European stock markets sank on Monday with dealers spooked by uncertainty over Donald Trump’s divisive immigration ban, dealers said.
The newly-installed US president on Friday signed an executive order banning travellers from seven Muslim-majority countries that was met with widespread outrage from world leaders and mass global protests.
“Global indices have started on the back foot after US President Trump announced one of his most radical policies yet, in the form of a travel ban,” said CMC Markets analyst Michael Hewson.
“The resulting press criticism and mass protests appear to have pushed some investors to the sidelines as rising uncertainty in the ability of the president not to cause damage to the US economy starts to increase, and uncertainty rarely bodes well for financial markets.
“This uncertainty has filtered across into European markets,” Hewson added. In foreign exchange, the dollar dived against its major rivals on the back of Trump woes, while Asian markets were subdued in holiday-thinned trade.
A disappointing reading on US economic growth added to the downbeat sentiment with Wall Street ending last week on a negative note. “The main focus over the weekend has been Trump’s immigration policy and it won’t necessarily surprise to see some heat coming out of the dollar,” said IG market strategist Chris Weston. “Whether the markets start to price in a stronger Trump risk premium is yet to be seen.”
Analysts said markets have shown resilience despite a series of controversial moves by Trump in his first week in office, including a row with Mexico over trade and his proposed border wall, rows with the media over his inauguration crowds and unsupported assertions that millions of people voted illegally in the 2016 election. This was
Concerns on protectionism appear to be rising Adam Cole, head of G10 forex strategy, RBC
put down to hopes he will stick to his promise to ramp up infrastructure spending, cut taxes and slash red tape to boost economic growth and corporate profits. Eyes are now on the Friday release of US jobs data for January, which comes a week after figures showing US growth reached a sluggish 1.9 per cent in October-December, well below the 3.5 per cent in the thirdquarter and below expectations.
The weak figures helped dampen sentiment on Wall Street, where the Dow edged lower Friday, at the end of a week in which it broke 20,000 points for the first time. — AFP