US stocks remain on the rise, defying global jitters

Global Business

US stocks remain on the rise, defying global jitters

U.S. stocks got off to a rocky start in 2016, with the major averages down 5 percent in the first month of the year. Worries about China’s slowing economy caused jitters among many investors.

But by the second week of February, sentiment reversed course and Wall Street continued on with its march higher throughout most of the year.

CCTV America’s Karina Huber has more.

From February until the end of this year, there were only two major dips on Wall Street. The first occurred in June, triggered by the Brexit results.

The day after U.K. voters opted to separate from Europe, the major U.S. indices fell between 3 and 4 percent wiping out $800 billion in U.S. market value.

Although just a week later, most of those losses had been recouped, some market watchers think the problem could come back to haunt investors as the process of Brexit takes hold.

The next big dip occurred on Nov. 4 – the day the FBI announced it was re-investigating U.S. presidential nominee Hillary Clinton’s personal emails. An air of uncertainty blew into the U.S. election, at a time when Clinton was widely assumed to win.

On election night as it became increasingly clear Trump would win, Dow futures fell 800 points but by the time the markets opened the next morning, they were in positive territory.

The main beneficiary of the Trump bump was bank stocks, mainly because of the expectation Trump will loosen financial regulation.

Rising interest rates are also good for the financials. The Federal Reserve announced a rate hike in December and it expects to raise them three more times in 2017.

Another sector that rebounded towards the end of 2016 was energy. OPEC’s decision to cut production for the first time in eight years sent energy shares soaring.


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