Dollar goes up after first Biden-Trump presidential debate

Turbulent. This word aptly captures the market's response to the first presidential debate between Joe Biden, the incumbent Democratic President, and Donald Trump, the former Republican President. Held in Atlanta and hosted by CNN, this high-stakes encounter had significant repercussions for the financial markets. 

The debate was a heated exchange (to say the least), with Trump criticising Biden’s speaking style and occasional verbal missteps. Amidst the intense debate and scrutiny over Biden's health, the markets exhibited notable volatility.  

The event highlighted the movements of two key assets in the trading world – the dollar and gold. Interestingly, the Trump Media & Technology Group made some short-lived gains as well. 

Dollar rises, gold Falls

In line with their historical trends, the dollar and gold reacted in opposite directions during the debate.  

The dollar index, which measures the greenback's performance against a basket of six major global currencies, increased by 0.24%, reaching 106.125 points.  

Conversely, the price of gold decreased by 0.39%, falling to $2,319 per ounce. These shifts were observed during the debate, with both assets returning to their typical patterns in the following trading session. 

The debate's impact was also felt on Wall Street. The S&P 500 rose by 0.33% at opening bell, while the Nasdaq and Dow Jones indices also posted gains of 0.25% and 0.28% respectively. 

Trump-owned DJT stock gains 6% (then loses it) 

In a notable market development, shares of DJT (Trump Media & Technology Group), the parent company of Trump’s social media platform Truth Social, experienced significant fluctuations.  

The stock was on a decline of over 50% following Trump’s legal challenges, including his conviction by a New York jury for falsifying documents and business records related to payments made in 2016. 

After the debate, DJT shares saw a temporary surge of over 6% at the Nasdaq's opening.  

However, this upward movement was short-lived, as the shares fell by 5.84% later in the session, erasing the initial gains and underscoring the stock's volatility. 

Is the Fed going to cut rates this September? 

Throughout these market developments, the Federal Reserve has been closely monitoring the situation.  

Recent personal consumption data, which met market expectations at 2.6% in both standard and core measures, provides a backdrop for potential adjustments in monetary policy.  

This data supports the possibility of an interest rate cut at the upcoming Federal Open Market Committee (FOMC) meeting on 18 September. 

As we continue to observe the implications of this debate on the markets, it remains clear that the intersection of political events and economic indicators will play a crucial role in shaping the financial landscape in coming months.