Another bearish day on Wall Street

US markets had another bearish day with the main indices down as talk of a US government shutdown crept up the news agenda, despite the resignation of Trump’s defence secretary John ‘Mad Dog’ Mattis.

Trump vs Congress equals more market uncertainty

Current volatility is as its highest level since February, not helped by the fact that the president has said he will veto a bill to keep the government running unless Congress signs off on the $5 billion he wants for his Mexican wall project. The White House is becoming increasingly conscious that the wall, one of the key election promises in 2016, has still not been delivered. Trump faces a new Congress in January, with the Democrats in control of the House, with even more dire implications for the fabled wall.

We’ve seen Asian indexes down overnight in response to Wall Street – Tokyo’s Topix is down almost 2% and probing levels not seen since April 2017. China’s CSI 300 index was also down 1.7%. The JPY has strengthened considerably against the USD this week as it is often bought by traders when markets look uncertain. It is getting close to 111 and to the USD at levels not seen since September.

Investor fear is starting to pump the gold price

As market uncertainty increases some investors predictably turn to gold. Market watchers are using the gold price as a measure of whether confidence in the equity market is really ebbing. Gold is trading steady at around the $1260 mark, but added around $17 on Thursday trading. As tensions in Washington have been ratcheted up ahead of today’s crunch decision on a government shut down over Christmas, so gold has climbed from around $1242 to break $1265 in the last 24 hours.

Just Eat sees sudden buying activity in wake of hedge fund criticism

Shares in online food delivery firm Just Eat were up more than 5% in early London trading. Just Eat has been taking plenty of flak from investors in recent weeks: activist hedge fund Cat Rock has not been pleased with the more than 28% decline in Just Eat’s stock this year, but the shares were reinforced this week when broker Liberum stated it though they were worth double the 578p they were trading at earlier this week. There is also now speculation that the company could be the target of a takeover bid. Both Cat Rock and Liberum have been critical of Just Eat’s overseas strategy but a bid may come from that direction too.