'Trump Time' - Let the games begin - Massive political uncertainty – President’s conflict with the CIA – ‘Strong dollar policy’ to end as U.S. has $120 trillion plus debt – Trump inherits Bush and Obama’s humongous debt
"It’s not just volatility; it’s valuation. Instead of magical lottery tickets that automatically and necessarily reward those who wait, stocks are ownership units of businesses. That’s banal, I know, but everyone seems to forget it. And it means equity returns depend on how much you pay for their future profits, not on how much price volatility you can endure."
European and Asian shares, and S&P futures slipped, while government bond yields jumped to multi-week highs on Thursday after Yellen's hawkish speech. Oil rose after API reported a drop in crude inventories. The euro rebounded as investors look to Mario Draghi to address rising European inflation that make the ECB's stimulative policies look increasingly out of sync.
"There are some really unexpected things happening with the Trump administration and there are no doubt a lot more people paying attention to Twitter at 2am in the night... We are operating in a very different environment where markets are reacting and adapting to changes that have not been seen for a good decade or more."
December was a fitting end to a difficult year for hedge funds: the single largest month of outfles in 2016, December also marked the sixth month of outflows in the last seven, and resulted in Q4 not only being the fifth consecutive quarter of redemptions, but also the largest quarterly outflow from the industry since Q1 2009.
Bitcoin prices in China had fallen last week after the PBOC began to investigate platforms and now, as Beijing News reports, margin trading and short selling violations were found at Bitcoin exchanges OkCoin and Huobi.com after preliminary inspections, according to PBOC officials.
European shares decline led by a plunge in Pearson shares, S&P futures were modestly in the green as Asian and EM stocks gained. The dollar rebounded against most major currencies after retreating 1.3% on Tuesday to the lowest in a month following Trump's "strong dollar" comments and halted a seven-day drop against the yen. "Everything is just a partial reversal of the price action yesterday," RBC Capital Markets currency strategist Adam Cole said.
British education group, and the world's largest education company, Pearson PLC lost a quarter of its market cap in an instant this morning after it issued a dire warning about the state of the textbook business, cut profit forecast, and warned of an "unprecedented" decline in its North American business.