Week in Review
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- Janet Yellen set to make history as the first female Treasury Secretary
The markets were characterized by many events and developments with the bigger part of the action being mostly contained within the second half of the week. Monday was a day off for US traders and investors who celebrated Martin Luther King, Jr. Day. While the US was taking a break, Asian and European markets were operating regularly without any distinctive or memorable occurrences.
Former Federal Reserve Chairwoman, Janet Yellen, went through a formal Senate confirmation hearing on Tuesday. As she is on her way to becoming the first female Treasury Secretary, Janet Yellen addressed key economic development issues. In her comments before the Senate Finance Committee, the Treasury Secretary nominee endorsed the proposed fiscal relief package by Joe Biden. In her words, the $1.9tn fiscal stimulus should be acted upon by congressional leaders as quickly as possible. Additionally, Ms. Yellen vowed to work towards prosperity and job creation as the US is currently facing an economic downturn during a pandemic that still rages across the continent.
Last week will go down in history for an Inauguration Day that was different from all the rest. Joe Biden was sworn in as the 46th President of the United States. The ceremony took place in Washington DC as 25,000 troops were patrolling the city to prevent any violent acts similar to those experienced two weeks ago. The now-former US President, Donald Trump bid farewell to Washington an hour before the official event and did not attend the inauguration ceremony.
The Markets Welcome the New Presidency
The markets took well the change of power in the White House and cheered the incoming administration. Benchmark indexes, Dow Jones, S&P500, and Nasdaq Composite, all closed at record highs following the inauguration on Wednesday.
During the week, some US companies were set to release earnings reports. Netflix shares enjoyed a generous boost of 16% on Thursday, following the earnings for the fourth quarter of 2020 which came in better than expected. The streaming giant added 8.51 million new customers for the period from October to December, bringing the total number to 37 million paying customers in 2020.
Going into other asset classes, Gold traded relatively flat on the week as the precious metal was not able to maintain the buying momentum that took the price to a high of $1,875 from Wednesday. The week marks the first weekly close in positive territory, snapping two consecutive weeks of losses.
The US dollar gradually depreciated against the euro throughout the week, while the British pound barely made it to positive territory for the week as buyers struggled to keep the momentum after negative economic data came from the UK.
Cryptocurrencies went through a sharp downturn this week. Total crypto market capitalization dipped below $1tn as bitcoin lost nearly 20% of its value in the last seven days. The number one digital coin was not able to break the $40,000 mark this week and gravitated towards the levels near $30,000-$32,000.
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