Bitcoin soared above $100,000 for the first time on Thursday after President-elect Donald Trump appointed a new regulatory chief seen as friendly to the cryptocurrency industry.
Trump said he would nominate Paul Atkins to serve as chairman of the Securities and Exchange Commission. Atkins is a former SEC commissioner who served as co-chair of the Cryptocurrency Policy Committee Token AllianceCommitted to “best practices in developing digital asset issuance and trading platforms” and the Digital Chamber of Commerce.
It was a memorable day for Bitcoin holders, who saw the cryptocurrency cross the $100,000 mark, trading around 5% higher on the day as investors bet on a friendly U.S. regulatory shifts.
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At the same time, Federal Reserve Chairman Powell's optimistic comments on the economy boosted market sentiment, and world stock markets hit new highs.
Powell said the economy was stronger than when the central bank began cutting interest rates in September, making policymakers likely to be more cautious in cutting rates further.
Japan's Nikkei closed 0.3% higher, with the MSCI world stock index hitting a new high.
Francois Savary, chief investment officer at Genvil Wealth Management, said falling U.S. Treasury yields in recent weeks, relatively strong U.S. data and Powell's latest comments have supported stock market sentiment.
“But this euphoria also comes with risks,” he added. “Everything is moving in the right direction now, but by the time January comes, (U.S. President-elect Donald) Trump will be in power and will have to implement an economic plan, people will realize that there may be some potential inflationary effects.”
Billions flow into Bitcoin ETFs
Geoff Kendrick, global head of digital asset research at Standard Chartered Bank, said that Bitcoin prices have risen as tens of billions of dollars in major investments have flowed into cryptocurrency exchange-traded funds (ETFs) since they were approved earlier this year.
“At the end of the day, it's just a number,” he said. “But the reality is that we've been able to get to this level because the industry has become institutionalized this year, and that's primarily the inflow of ETFs.”
It was a day of positive sentiment, with optimism about a U.S. interest rate cut also boosting the broader market higher.
Over the past week and a half, the market has almost priced in further U.S. interest rate cuts in 2025, with the implied probability of a rate cut in December rising from an even number to around 75%.
Earlier this week, Federal Reserve Governor Christopher Waller said he was leaning toward a rate cut later in December.
A closely watched U.S. ISM survey showed services sector activity slowed in November after rising sharply in recent months. Benchmark 10-year Treasury yields edged higher after falling a day earlier.
The focus this week is Friday's U.S. jobs data.
The dollar weakened against major currencies, eventually falling 0.25% to 150.23 yen.
The euro strengthened slightly to $1.0521 and sterling rose 0.1% to $1.2716.
French government collapse has been 'priced'
Investors' risk premium for holding French government bonds over German Bunds fell further below their highest level in 12 years on Thursday, following widespread expectations of a collapse of the French government.
French stocks rose to their highest level in more than three weeks.
Savary Genvil Wealth Management said: “A lot of the bad news has been priced in and it is clear that we are heading towards the collapse of the government.”
Elsewhere, the Australian dollar traded at $0.6435 against the U.S. dollar on Wednesday, its biggest drop in a month as growth data was weaker than expected.
However, the Korean financial market is South Korean President Yoon Seok-yeol's attempt to impose martial law fails That sparked volatility and political crisis late Tuesday.
Oil futures turned negative on Thursday after OPEC+ agreed to postpone a planned oil production increase until April 2025, sources told Reuters.
Brent crude was down 25 cents at $72.06 a barrel by 1152 GMT, while U.S. West Texas Intermediate crude was at $68.25 a barrel.
Gold prices fell 0.25% to $2,643 an ounce.
- Reuters Additional editing by Jim Pollard
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