Stocks and commodity currencies drop as caution returns to Wall Street

The best post-Christmas rally is over and most of the gains are already gone. Europe returned to the markets and traded mix. What was discerning for the equity rebound was that it did not take to the news that China and US will hold mid-level talks on the week of January 7th. Expectations are for the US to increase their demands and intensify the trade war. Today, the US Senate will convene and vote on a bill to end the partial government shutdown.

The Dow fell over 300 points at the open, lower by 1.3% and giving back almost a third of yesterday’s surge.  The dollar also rallied against the commodity currencies, with gains of over 0.5% against the Australian dollar, kiwi and loonie.

With the choppy conditions likely to persist until the new year, many will keep a close eye if the stocks can keep this bottom.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Ed Moya

Ed Moya

Senior Market Analyst at OANDA
With more than 20 years’ trading experience, Ed Moya is a market analyst with OANDA, producing up-to-the-minute fundamental analysis of geo-political events and monetary policies in the US, Europe, the Middle East and North Africa. Over the course of his career, he has worked with some of the world’s leading forex brokerages and research departments including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including BNN, CNBC, Fox Business, and Bloomberg. He is often quoted in leading print and online publications such as the Wall Street Journal and the Washington Post. He holds a BA in Economics from Rutgers University. Follow Ed on Twitter @edjmoya ‏
Ed Moya