According to Bloomberg, the American stock market has nearly erased all its gains in the month following Donald Trump‘s victory.
On January 13, during trading, the S&P 500 index dropped below its closing level on November 5, 2024, reaching 5,773.31 points. At the beginning of December, this figure was 6,081.38 points.
Analysts attribute the decline in American stocks to investor concerns regarding the new administration’s plans and the Federal Reserve’s monetary policy. Investors are apprehensive about Trump’s proposals to impose high tariffs on imported goods from China, Europe and Canada. These increased tariffs are expected to raise costs for American companies and lead to inflation.
The stricter immigration policies of the new administration could contribute to inflationary pressures. Reducing cheap labour may increase the prices of goods and services.
In light of Trump’s actions, investors anticipate that the Federal Reserve will tighten its monetary policy. In mid-December, the central bank announced it planned to cut interest rates only twice in 2025, a reduction from the previously expected four cuts.
In the first half of January, the yield on 20-year U.S. Treasury bonds exceeded 5% and continues to rise. This increase indicates growing inflation expectations among investors.
Kursiv Uzbekistan also reports on how the first trading week of January concluded for the stock market in Uzbekistan.
