U.S. Stock Futures Follow European Markets Lower on Thanksgiving; Crypto Rally Falls Short
U.S. stock futures declined on Thursday in concert with their European counterparts, as jittery investors steered clear of riskier assets ahead of high-profile trade talks next week between President Trump and Chinese counterpart Xi Jinping. Cryptocurrencies rallied overnight before losing their grip on gains as bitcoin cash continued to invoke fear, uncertainty and doubt.
The U.S. futures market on Thursday offered a glimpse of what investors can expect Friday morning when markets reopen after Thanksgiving. Dow Jones futures plunged 141 points in holiday-shortened trading to close at 24,324.00. The S&P 500 mini futures contract for December shed 16.25 points or 2,632.75. The Nasdaq 100 mini contract closed down 55.25 points at 6,521.00.
U.S. stocks were mostly higher on Wednesday, though the S&P 500 and Nasdaq finished well off session highs while the Dow completely reversed gains to finish flat.
European stocks were down across the board Thursday. The U.K.’s FTSE 100 Index slid 1.3% to close at 6,960.32. Germany’s DAX 30 Index fell 0.9% to 11,138.4. The pan-European Stoxx 50 Pr closed down 0.9% at 3,126.67, extending its 12-month slide to 12.2%.
Brexit In Focus
The United Kingdom has moved closer to exiting the European Union (EU) after Brussels “agreed in principle” on a new draft text that spelled out the conditions for Brexit. On Thursday, Prime Minister Theresa May said Brexit “is within our grasp” following 18 months of bitter negotiations.
The terms of the new agreement are unlikely to satisfy the hard Brexiters, who feel they won a clear mandate in 2016 to leave the union. Those in the Remain camp are also not pleased with the U.K.’s planned exit from the EU in March of next year, though they take solace in the fact that the current text leaves economic and trade ties intact for the foreseeable future.
It should be mentioned that the draft agreement is far from a done deal; May’s camp must still convince British parliament to approve the plan, which opens the door to bipartisan scrutiny.
Cryptocurrencies Under Pressure
Cryptoassets recovered modestly overnight, as the total market capitalization reached a high of $151.5 billion. However, the gains quickly evaporated with the market revering back to the $145 billion range, where it currently sits. Just a few days ago, the market cap bottomed near $140 billion, the lowest in over 13 months.
Trade volumes have plunged nearly 28% over the last 24 hours, which may have signaled that the worst of the downturn has passed. The selloff on Tuesday was associated with a large spike in trading activity, especially on BitMEX, the popular derivatives platform. At its height, BitMEX was processing more than 41% of bitcoin transactions earlier in the week. The bitcoin price traded slightly below $4,500 on Thursday, where it was little changed.
Bitcoin cash, on the other hand, was down nearly 6% at $217 as observers continued to monitor the ongoing hash war. A majority of exchanges have officially recognized bitcoin ABC as the primary implementation of bitcoin cash. The protocol has been assigned the BCH ticker symbol on these exchanges as well as on CoinMarketCap, which provides aggregate pricing data.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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