The Week in Review: Volatility Surrounds Global Markets
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- European markets close higher
- Elon Musk causes a stir in the crypto market
- Relationships between retail traders and brokers to be monitored as a result of recent activity with GameStop & AMC
Global Markets Outlook
Another volatile week went down in history. Global markets rose in unison as investors from Europe and the US supported the positive momentum throughout the week. European Markets & markets across the Atlantic close higher this week. Dow Jones Industrial Average, S&P, and the Nasdaq Composite all ticked higher for the week as market participants remained optimistic towards the big-ticket spending. President Biden will try to pass the $1.9tn fiscal relief package without the support of the Republicans.
The US dollar advanced among its peers this week. The EUR/USD rate slipped towards the 1.20 region, while USD/CHF and USD/JPY closed the week higher by over 1.00% each. Gold drops towards $1,800 levels. Investors are now flocking to riskier assets on the back of accelerating vaccination pace and the prospects of the stimulus approval. The precious metal started the week on a positive note and climbed to a weekly high of $1,872. Gold bugs failed to keep the buying momentum going and the asset slipped to a weekly low of $1,785 on Thursday.
Volatility in the Crypto Market
Over to the cryptocurrency market, bitcoin remained somewhat steady below the $40,000 mark. The week saw bitcoin trading mostly flat, gravitating towards the $35,000 level. However, Dogecoin witnesses some volatility over the last couple of days. Dogecoin. Doge advanced more than 50% on Thursday after Elon Musk posted a series of tweets in favor of the crypto asset, created as a meme coin back in 2013. The rally in Dogecoin eased off its highs by Friday.
Financial Regulators to Monitor Trading Practices
The GameStop saga cooled down this week after the heightened volatility caught the attention of regulators. Treasury Secretary Janet Yellen convened a meeting on Thursday with the heads of the Securities and Exchange Commission, the Federal Reserve, and the Commodity Futures and Trading Commission. The meeting was organized with the intention to discuss the recent spike in volatility in individual stocks like GameStop and AMC and to assess if investors are protected. Тhe meeting between the top financial regulators vowed to continue monitoring and reviewing trading practices and relationships between retail traders and brokers who provide access to the financial markets.
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