Investing.com – Take a peek at the top 5 things that rocked U.S. markets this week.
Investors chomping at the Bitcoin
Bitcoin recorded a series of all-time highs this week just shy of $4,500, on the back of optimism over the future of the digital currency.
Gains were reversed in the latter part of the week, however, amid growing concerns the digital currency could face a second split in November.
The second part of the SegWit2x due November, seeks to double the transaction capacity on the bitcoin network, allowing speedier transactions, however, not all members of the bitcoin community agree with the proposal, raising fears of a yet another split in the digital currency – an event known as a ‘hard fork’.
Bitcoin Cash dodged the cryptocurrency bears, rallying about 60% to $604.75 on signs the newly created cryptocurrency could support an eight-megabyte block compared to the original bitcoin’s one megabyte.
The minutes from Fed’s July meeting raised uncertainty over future rate hikes
Federal Reserve policymakers were split on the outlook for future rate hikes amid concerns over weak inflation, according to the minutes of the Fed's last policy meeting released on Wednesday.
The minutes showed that "some participants" expressed concerns about the slowdown in inflation, and wanted to wait until it was clear the trend of slow inflation was transitory.
On the Fed’s plan to reduce its $4.5 trillion balance sheet, members agreed that normalization of the central bank’s balance sheet should begin “relative soon”, while others argued for a more concrete date to be set.
According to investing.com’s Fed rate monitor tool, 42% of investors expect the Fed to hike rates in December.
US political drama dented rally on Wall Street
U.S. political drama gripped Wall Street on Thursday as the Dow shed 270 points, following rumours that National Economic Council Chairman Gary Cohn was set to resign, over the president’s failure to denounce white supremacist violence in Charlottesville over the weekend.
A White House official, however, quashed the rumours, saying Cohn “is focused on his responsibilities as NEC Director and any reports to the contrary are 100% false.”
U.S. stocks added to losses on Friday, as U.S. political uncertainty continued, after White house chief strategist Steven Bannon resigned, raising doubts over President Donald Trump’s ability to push through his pro-growth economic agenda.
Gold jumped above $1,300
A somewhat dovish minutes from the Federal Reserve’s policy meeting, followed by the ongoing political saga in Washington stocked safe-haven demand, boosting gold futures to a 9-month high of $1,306.
The precious metal, however, struggled to stay above $1,300 as investors appeared to take profit amid better-than-expected consumer sentiment data for August suggesting the U.S. economy was on track to deliver solid gains for the third quarter.
Crude oil suffered 3-week losing streak
Crude Oil WTI Futures settled sharply higher on Friday, but failed to recoup losses sustained earlier during week, following concerns over an uptick in U.S. production.
Total crude-oil production rose to 9.502m barrels per day, an uptick of 79,000 barrels a day compared to last week, the EIA said on Wednesday. That was the highest weekly output figure since mid-July 2015, which offset bullish crude inventories data.
Inventories of U.S. crude fell by roughly 8.9m barrels in the week ended Aug 11, confounding expectations of a draw of about only 3.6m barrels. It was biggest draw in crude inventories in eleven-months.