Global stock markets rose to break the world record. All the main stock markets including the US, the UK, Sweden, and Germany. Japan stock market also showed a lot of improvement, closing its best point since the year 2000.
Similarly, many of the European markets including Belgium, France, the Netherlands, and Ireland achieved their highest levels since 2008.
Why Global Stock Markets Peaked?
The news from Europe was positive. The European Central Bank promised to announce an economic stimulus package This economic package is expected to put the worried investors at ease worried weary about Greece’s economic woes. Similarly, this gesture also shows that larger countries in the EU like Germany want to help Greece get out of its financial problems.
France has shown more support for Macron, who represents a balanced approached towards all issues. His EU-friendly views put the fears of Frexit at ease, at least for now.
The global stock markets also peaked because of the American Fed Reserve’s Chair Janet Yellen gave a positive outlook for the US economy.
Underlying Fears of the Stock Market
Despite the positive outlook, many things are worrying the global stock market.
Some of the worries include the following.
- There is a chance of a serious conflict between Russian and the Ukraine.
- The problems looming in Syria and the unresolved issues between Russia and the United States.
- The fear of a slowdown in the Chinese and European economies playing an important role in fueling growth.
- The conflict between North Korea and the United States which can potentially get out of control.
Trump Tax Cuts
Donald Trump, the US President, will announce tax reductions or reforms. Reports from inside sources suggest that Donald Trump wants to cut the tax to 15 percent. The measures are said to deliver windfall profits to the companies that have staked their cash outside the United States.
Donald Trump is expected to lower the repatriation tax to 10% from 35%. An estimated one trillion dollars is lying outside the United States. The measure will let companies get back their cash into the US at a much lower cost.
Continuity of Global Stock Markets Current Position
The positive news fuels speculation for a brighter future for the global stock markets. It is very early to say for how long will this position last. The second round of the French Elections will have its impact on the global stock markets. Similarly, Donald Trump’s announcement on tax reduction will also affect the market sentiment. Lastly, world peace is a major factor contributing to the confidence of the stock market investors.