European stocks and bond yields tumble and the dollar hits a six-week low after U.S. President Donald Trump began his term in office with a protectionist speech that pushed a nervous market into safe-haven assets. Ciara Lee reports
Gone are the multi-year highs hit earlier this month. Replaced with a six week low for the dollar and tumbling stocks and bond yields in Europe. It comes after U.S. President Donald Trump began his term in office with a protectionist speech, signalling an isolationist stance on trade and other issues. And pushing a nervous market into safe-haven assets. (SOUNDBITE) (English) IG MARKET ANALYST, CHRIS BEAUCHAMP, SAYING: "We got more of a classic Trump campaign style on Friday, and that's rattling nerves a bit really. What the rhetoric, how it will match up with reality. What the first executive orders will be. And I think in that sense we are looking at the impact on trade deals, and we're looking at the impact really on immigration. And that's the key worry I think. The shift away from open market liberal order that's dominated". Japan's Nikkei dropped 1.1 percent while shares in Australia dropped 0.8 percent. Trump's administration wants to withdraw from the Trans-Pacific Partnership - a 12-nation trade pact that Japan and Australia have both signed. And investors are rattled about his plans to hold talks with the leaders of Canada and Mexico to renegotiate the North American Free Trade Agreement. (SOUNDBITE) (English) IG MARKET ANALYST, CHRIS BEAUCHAMP, SAYING: "It is the big question, how far will he go in unraveling NAFTA, how far will he go in combatting China, declaring China a currency manipulator, as they promised on the campaign trail. How will this play out with the UK's relationship with the EU, with of course the UK being promised a trade deal." Investors had been banking on Trump boosting growth and inflation with big fiscal spending. But after weeks of optimism, doubts could be creeping in over whether their expectations will be fulfilled.