The initial high is followed by disappointment
As the market opened yesterday, Wednesday, the DAX shot up by several hundred points, only to turn around at the day's high and level out the accumulated gains. At the end of the trading day, the DAX was ultimately down 1.13% and fell back to 19,093 points from its daily high of 19,563. The surprise of Trump's clear victory has hit the markets and is likely to affect Europe in its foreign trade with the USA, as the new US President Donald Trump is in favour of higher import tariffs. This is likely to hit exports from Europe to the US hard in many areas.
High volatility - Federal Reserve ahead of interest rate decision
However, it remains to be seen how Trump intends to get the budget deficit under control, as the promised tax cuts need to be financed. In any case, the Republicans have managed to celebrate a landslide victory and every government, especially in this country, should finally realize that such results can come about when the citizens of the respective country are ignored. Team Scholz, Habeck should not close their eyes to this, now that Christian Lindner has already been shown the door. This Thursday evening, the next monetary policy highlight is already on the calendar for investors when the Federal Reserve's Open Market Committee makes its interest rate decision. The general impression is that the Federal Reserve always makes its decisions a little more conservatively than the market prices in in advance, so erratic movements could occur again today after yesterday's volatility.
Gold slumps by over 3 percent
A major slump was seen in gold yesterday. The precious metal has finally entered a correction. In just one trading day, the price of the shiny precious metal fell by more than three percent. Investors will be keeping a close eye on how the monetary policy decision will affect gold. There could also be hope that the dollar will be weakened somewhat by the Federal Reserve, allowing gold to rise again.
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