Summary
- Market roundup for Wednesday portrays mixed U.S. data, a pullback in Dollar, and cautious optimism.
- Bitcoin rises to $112K, Gold refreshes ATH while the U.S. Dollar drops.
- U.S. Factory Orders improved, but JOLTS Job Openings eased and Fed talks seem optimistic.
- A challenge to Trump’s firing of officials and Fed independence jitters weigh on risk profile, while easing bond yields favor tame market fears.
- Traders remain cautious before Friday’s U.S. Nonfarm Payrolls (NFP) after last month’s controversial release.
- Crypto industry news is mostly upbeat, while equities reverse the previous losses.
Market Roundup for Wednesday: Economic fears recede
Financial markets witness cautious optimism early Wednesday, facing a mix of economic data and geopolitical developments, but taking a sigh of relief after the bond market signals.
Sentiment was pressured by renewed concerns about the independence of the Federal Reserve (Fed), former U.S. President Donald Trump’s legal and political actions, and broader trade tensions.
Against this backdrop, Bitcoin (BTC) rises for the third consecutive day to $112,000, while gold (XAU) hits a fresh record near $3,550. That said, the U.S. Dollar Index (DXY) reverses the previous day’s gains while equities rebound and the bond yields ease.
On Tuesday, long-term bond yields from the U.S., Japan, Germany, and the UK jumped to multi-year highs and flagged recession fears. However, the bond market woes eased early Wednesday as bond coupons retreated ex-Japan.
Elsewhere, legal tensions resurfaced as the D.C. Circuit Court of Appeals reinstated Rebecca Slaughter to the Federal Trade Commission (FTC) after her removal by Trump without cause. This raised doubts over Trump’s authority to dismiss federal officials, including Federal Reserve Chair Jerome Powell, and added friction amid his legal clash with Federal Reserve Governor Lisa Cook. Meanwhile, the Wall Street Journal reported that U.S. Treasury Secretary Bessent will begin interviewing candidates to potentially replace Powell starting Friday.
U.S. economic data came in mixed as July Factory Orders improved to -1.3% Month-over-Month (MoM), versus -1.4% expected and -4.8% prior, while Job Openings from the Job Openings and Labor Turnover Survey (JOLTS) dropped to 7.181 million, the lowest level since March 2021.
The statements from the Federal Reserve (Fed) officials have also been slightly upbeat and favored the sentiment, but have failed to defend the U.S. Dollar bulls. That said, Atlanta Fed chief Raphael Bostic marked expectation of a 0.25% rate cut during the year despite saying, “Businesses still expect a solid year; other evidence indicates Fed policy is not overly restrictive.”
On the same line, St Louis Fed President Alberto Musalem also stated that the current restrictive policy is in the right place given the data. Further, Fed Governor Christopher Waller mentioned, “We should cut at the next meeting, but we don’t have to cut at every meeting.”
Talking about geopolitics, U.S. President Donald Trump accused Chinese President Xi Jinping of aligning with Russia and North Korea during a joint military parade, calling it a conspiracy against the United States.
Trump also confirmed plans to take his tariff-related dispute to the Supreme Court, after a challenge to his use of national emergency powers to impose tariffs. He dismissed health concerns and criticized China, India, and Brazil for harming U.S. trade with excessive tariffs.
Crypto, Equity Update
Major cryptocurrencies cautiously defend early-week gains as the U.S. Dollar holds steady but fails to rise further. Market optimism builds on upbeat industry news, month-start positioning, and easing bond market economic warnings.
Some of the top crypto news are as follows, while more updates like this could be traced to our Crypto Bytes.
India tops Chainalysis’ Global Crypto Adoption Index for the third straight year, driven by rising digital payments, growing retail interest, and strong peer-to-peer trading.
KuCoin signs a strategic MOU with 1Matrix and Vietnam Blockchain and Digital Assets Association (VBA) to boost digital asset use, speed up blockchain development, and drive Vietnam’s digital economy growth.
Galaxy Digital plans to convert its shares into on-chain tokens. Details mention that Galaxy will use Superstate’s Opening Bell technology to convert its U.S. Securities and Exchange Commission (SEC) registered GLXY shares into the on-chain tokens. The KYC-approved shareholders can tokenize their shares, aiming for future trading on Decentralized Finance (DeFi) and Automated Market Maker (AMM) platforms, starting with Solana.
Elsewhere, Chainlink whales bought 1.25 million LINK tokens in the last 48 hours, helping the altcoin to rise over 5.0% in the last two days.
Read Details Here: Chainlink Whales Buy 1.25 Million LINK, Could Price Rally Next?
On the equity front, easing bond yields and news surrounding Alphabet allowed Wall Street benchmarks to pare Tuesday’s losses. Also favoring the U.S. shares is the cautious optimism ahead of the after-market release of quarterly earnings from Salesforce Inc.
That said, Nasdaq and S&P 500 both snap two-day losing streak with 1.20% and 0.50% intraday gains respectively, but the Dow Jones is still posting modest losses around the 45,100 mark as we write.
Late Tuesday, a U.S. court ruled that Alphabet Inc. (Google) must share certain search data with competitors but does not need to sell its Chrome browser. This helped Alphabet shares rally and lifted broader tech sentiment in after-hours trading.
- Gold refreshes ATH, up for the seventh consecutive day with 0.85% intraday gains to $3,565 as we write.
- Bitcoin (BTC) holds recovery from a two-month low, rising 1.0% on the day to $112,100 at the latest.
- Ethereum (ETH) jumps over 3.0%, extending Tuesday’s gains to $4,480 by press time.
- U.S. Dollar Index (DXY) reverses gains, down 0.20% intraday to 98.10 at the latest.
- Wall Street is slightly upbeat, with Nasdaq and S&P 500 both snapping two-day losing streaks, but Dow Jones is losing around 0.20% on the day as we write.
- WTI Crude Oil drops over 2.0%, reversing the previous day’s gains as sellers approach $64.00.
Risk catalysts eyed…
Having witnessed cautious optimism during the initial hours of the New York trading, despite mixed U.S. data, traders will pay attention to the risk news and Salesforce Inc. results for clear directions. This might help the USD to pare some of its latest losses and can stop the latest rise of the risk assets like equities and cryptocurrencies. However, gold may still remain firmer and aim for the $3,600 as it successfully cleared the $3,550 hurdle.
