Visa released a report that has sent global stock markets in a buying frenzy on 27 Dec.
Visa reported a (6) year high in US festivity spend of USD850billion, a 5.1% high compared to 2017. This report then defied concerns around slowing down in US economy.
Market indicators out of blood bath zone
The dow jones index was up over 1,026 points (4.98%) while the S&P 500 rallied 4.96% and Nasdaq rose 5.84%. Asia was able to catch this contagious rally reflecting in a 1% bullish MSCI broadest index of Asian shares excluding Japan index as the Japanese Nikkei rose 3.8% spiraling out of negative territory. Australian NZ index, the barometer of global pulse, levitated 1.6%.
Trump inflicted political risks still cap gains
Despite this positive beam of light, political risks in the worlds largest economy still continues to cap gains. The US economy currently grapples with political risk concerns in light of sentiments that Trump was displeased with US Fed chair Jerome Powell’s stance to hike rates (25bps) a move that almost put his job in jeopardy. Trump terminated his defense secretary’s contract 2 months earlier on differences in foreign policy on troops in Syria.
The partial government shutdown extending into January, has been another key concern as Trump is willing to wait for tax payer’s money to the tune USD5billion to fund the Mexico wall.
China still growing slow
The Chinese national bureau of statistics (NBS) released earnings data for November that reflect a 1.8% decline in eastern blocs non industrial profits to USD86.33billion, the first slide since Dec 2015.