Stock Markets fall and Cryptocurrency Crash worsens

Stock Markets fall and Cryptocurrency Crash worsens

Global stocks fell and cryptocurrencies plunged further on Wednesday as a threat of unwanted inflation drove investors away from assets deemed vulnerable to any removal of monetary stimulus.

* Digital currencies were also under pressure from new Chinese restrictions on financial institutions that provide services related to cryptocurrency transactions.

* But as the dollar moved away from its lowest levels of the year against its rivals, gold prices, seen as a hedge against inflation, reversed their recent course and were trading lower, away from their highs of almost four months.

* “The image of the bitcoin flow continues to deteriorate and points to a continued decline in institutional investors,” JPMorgan analysts wrote in a research note.

* Institutional investors appeared to be moving away from cryptocurrency and back to traditional gold, reversing a trend from the previous two quarters, they added.

* Cautious sentiment pervaded equity markets, with attention focused on releasing the minutes of last month’s meeting of the Federal Reserve later in the session.

* The STOXX 600 Index was down 1.3%, heading for its biggest drop in more than a week, while the MSCI Global Stocks indicator was down 0.4%.

* MSCI’s Broad Asia Pacific Stock Index outside of Japan fell 0.6%, although the Hong Kong and South Korea exchanges are closed for holidays. Japan’s Nikkei lost 1.3%.

* While demand is recovering rapidly as many developed countries have moved forward with COVID-19 vaccination, companies face stumbling blocks from shortages of chips, packaging and, in the United States, workers as well, fueling concern for the higher prices.

* Reflecting an ongoing move in the United States as the global recovery takes hold, British consumer price inflation accelerated sharply to 1.5% in April, data showed Wednesday.

* Euro zone inflation rebounded the same month, and consumer prices rose 0.6% month-on-month for a 1.6% year-on-year increase.

* In the United States, the Fed has stuck to the narrative that a recent rise in inflation would be transitory and that it should therefore maintain its expansionary monetary policy setting. Minutes from the April meeting are expected to echo that message.

* Bitcoin and Ethereum posted their biggest one-day decline since March last year, with losses in market capitalization for the entire crypto sector approaching $ 1 trillion.

* The sharp declines came after China banned financial and payment institutions from providing cryptocurrency services.

* Bitcoin fell to $ 30,066, the lowest since late January, while Ethereum sank to $ 1,850, its weakest level since late January.

Samuel Edwards
Samuel Edwards is the name you must have heard many times while reading reports related to Finance, that's what he is good at. From Major Investments to Stock Market Updates, he got 'em all. Be ready to blow your mind by the mind-blowing reports of Finance World from Samuel Edwards.