US Treasuries rise, dollar falls as Trump gives little policy detail

US Treasuries rise, dollar falls as Trump gives little policy detail
# 12 January 2017 08:50 (UTC +04:00)

U.S. Treasuries rallied across the board on Wednesday, while the dollar fell after trading higher for most of the session as President-elect Donald Trump did not provide much clarity on his future policies, Reuters reported.

U.S. stocks also weakened initially after Trump took aim at the pharmaceutical industry for charging high prices. He said pharmaceutical companies are "getting away with murder."

"U.S. Treasuries rose because stocks caved in with Trump's pharmaceutical comments," said Kim Rupert, managing director of global fixed income at Action Economics in San Francisco. "Overall Trump did not really say anything new. As a result, we're still in wait-and-see mode with respect to his policies."

In his first press briefing as U.S. president-elect, Trump presided over a wide-ranging session that touched on topics such as allegations of Russia spying, Mexico, his business interests, and drug pricing.

But the briefing, which lasted longer than people expected, did not break new ground, analysts said.

Traders were hoping that after making generally broad statement for the last two months on what he intended to do as president, Trump would give more specific details about key policy reforms.

The Dow Jones industrial average was up 0.2 percent on the day at 19,901.57, while the S&P 500 fell 0.3 percent to 2,262.98. The Nasdaq Composite added 0.1 percent, to 5,526.05, a day after hitting a record high.

Other global stock indexes edged higher as well.

The UK's FTSE 100 posted a record 12th straight day of gains while European shares rose 0.2 percent to 364.90.

MSCI's broadest index of Asia-Pacific shares outside Japan also gained 0.83 percent, to 445.2, while the MSCI world equity index, which tracks shares in 45 nations, inched 0.2 percent higher to 429.88.

In the bond market, benchmark U.S. 10-year Treasury prices were up 9/32 in price, yielding 2.344 percent, down from Tuesday's 2.379 percent. German 10-year yields also fell to 0.2410 percent, from 0.248 percent the previous session.

Trump's comments reversed earlier dollar gains, with the dollar falling 0.4 percent against a basket of currencies to 101.58. The greenback also fell sharply versus the yen, down 0.7 percent at 114.92 yen.

Trump's campaign calls for tax cuts and more infrastructure spending have boosted U.S. shares and the dollar, as well as driving a selloff in Treasuries, but his protectionist statements and a flurry of off-the-cuff Tweets have kept many investors from adding to risky positions.

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