The dollar jumped and short-term U.S. Treasury yields hit the highest since 2009 as investors focused less on U.S. President Donald Trump's first speech to Congress and more on what they see as a growing chance of a U.S. interest rate hike this month. Sonia Legg reports
There were fears markets would be disappointed if President Trump's speech to Congress lacked detail. But they weren't - even though it did. (SOUNDBITE) (English) MIKE INGRAM, MARKET ANALYST, BGC PARTNERS, SAYING: "There wasn't anything new there, nothing that we didn't know or thought we knew and yet we are seeing markets take this quite constructively." The reason wasn't his promise to restart the engine of the American economy. Or a pledge to make it easier for companies to do business in the US. It was simpler than that. (SOUNDBITE) (English) MIKE INGRAM, MARKET ANALYST, BGC PARTNERS, SAYING: "Given the track record of Donald Trump and his addiction to Twitter and inflammatory comments I think the presidential tone of the speech delivered last night reassured many people." The dollar and U.S. Treasury yields jumped. Asian shares were relieved there were no decisions on trade. And European stocks gained, with basic resources the top-performers, thanks to a promise of $1 trillion of infrastructure spending. Investors though were more focused on the growing chance of a U.S. interest rate hike. (SOUNDBITE) (English) MIKE INGRAM, MARKET ANALYST, BGC PARTNERS, SAYING: "Even before Trump's speech last night we saw Fed presidents step up the plate and really maintain the hawkish rhetoric we have seen out of the Fed in recent weeks and the market implied probability from Fed futures for a March rate hike actually jumped to 80 percent." Trump also vowed to overhaul the immigration system, improve wages and deliver tax relief to workers and companies. He offered few clues on how he would achieve that. But markets - for now - seem willing to carry on living on promises.