Market Snapshot – Global Stocks under Pressure on US Tax Reform Doubt

Stock Markets Under Pressure

The stock markets have been driven lower over the last few days due to the postponement of the tax cut plan for the corporates in the US. This has served to be a disappointment to the corporates and this has been showing in the reversal of the gains that were seen in the stock markets following the announcement of the tax reform bill a few weeks ago. This reversal has been affecting the Asian and European stock indices as well and the fall in the markets continues as of today as well. Also, there continues to be some confusion and uncertainty over the next rate hike from the Fed with the market still divided on whether there would be a rate hike in December or not and this is likely to keep the markets in tenterhooks.

To Hike or Not to Hike

If the Fed does manage to hike rates in December, then we should see the dollar getting stronger in due course of time and this is likely to be seen all across the board. But so far, the Fed members are trying to keep the market guessing as much as possible and they have managed to do that successfully. The incoming data over the next couple of weeks are likely to give more insight into how the Fed is going to choose and this promises a lot of volatility in the coming weeks.