Market Tensions Rise as Investors React to Trump's Economic Policies

Global stocks fell following investors' reactions to President-elect Trump's economic policies. U.S. Treasury yields and the dollar gained amid inflation concerns. Stocks surged post-election, with major indexes reaching record closes. Investors are wary as U.S.-China tensions and higher treasury yields influence global markets.

Global stock markets experienced a decline on Tuesday, snapping a five-day winning streak, as investors weighed the potential impacts of President-elect Donald Trump's economic policies. As the dollar reached a new peak for the first time in over four months, market participants assessed how proposed tariffs, tax reductions, and deregulation might influence future growth and inflation.

Investor enthusiasm surrounding Trump's policy advantages for banks and domestically focused small-cap stocks caused the S&P 500 to surge. Bitcoin also soared, nearing $90,000, boosted by Trump's promise to establish the U.S. as a cryptocurrency hub. Despite these gains, potential inflationary effects of Trump's policies have led to rising U.S. Treasury yields and a stronger dollar.

U.S. stock indexes closed at record levels on Monday, with Wall Street reflecting investor optimism. However, experts like Jack Ablin of Cresset Capital note that increasing 10-year Treasury yields could pose a challenge to equity rallies. As markets await the latest Consumer Price Index for October, concerns linger about inflationary risks amid ongoing global trade tensions.

(With inputs from agencies.)