Crypto World remains calm despite other markets sell-off

Analisi Giornaliera - 25/10/2018

Cryptocurrencies are holding up

On Thursday Cryptocurrencies continued to be stable despite the loss in global stock markets.

During the Asia session, bitcoin dropped by 0.23% to around $6,482, as XRP marked declines of 2.09% and ethereum dropped 1.38 %, according to data from Coinmarketcap.com. It's not surprising to notice that bitcoin is driving other digital tokens lower as well. The consecutive performance between cryptocurrencies opposed clearly with the last time there was a major market stock sell-off.

Early October bitcoin dropped more than 4%, while both XRP and ethereum fell more than 11% during Asia session only, according to data from Coinmarketcap.com. The CEO of cryptocurrency fund of hedge funds BitBull Joe DiPasquale, said "When we saw equity markets crumble, there was some fear in the cryptocurrency market as well," he said. "I think there was an initial jolt due to larger market activity and the sell off."

Dow erases almost a year’s profits

On Wednesday Stocks fell sharply while tech shares leading the fall and concerns regarding corporate earnings combined gave momentum to this month's steep pullback.

The Nasdaq Composite dropped about 4.39% to 7,108.39— opening the correction section — like Netflix, Facebook, Alphabet, and Amazon each went lower.

The Dow Jones Industrial Average fell 608.00 points at 24,583.41 and deleted all of its profits for 2018. The S&P 500 dropped about 3.0% to 2,656.9 and also became negative for the year.

Alec Young, managing director of global markets research at FTSE Russell said "An increasingly murky macro picture is clouding the 2019 earnings outlook leaving investors to largely shrug off a solid start to the third quarter earnings season." "While valuations have certainly come down in recent weeks, at 16 times forward earnings for the Russell 1000 index, they aren't in the bargain basement by any means, especially if earnings growth slows more than expected next year."

Yen strengthens while investors use is as a safety net

On Thursday the JPY climbed versus the greenback as a loss on Wall Street and vulnerable European and U.S. economic data marked global uncertainty, making investors run to safe-haven assets including government bonds.

The popular currency Yen may act as a safety net during periods of market confusion and economic anxiety, On Thursday it rose 0.2% and traded at 112.05 on the dollar.

Nervousness about U.S. corporate earnings and geopolitical confusion continued to raise concerns about global extension the past week, Italy's free-spending budget, and China-U.S. trade tensions. Margaret Yang, a market analyst in Singapore at CMC Markets said "Yen strengthening over the past three days is partly a reflection of surging demand for safety, as a result of global equity rout and rising volatility."

Oil markets dropped amid stock market fall

On Thursday, Oil prices dropped by about 0.9% beginning the day following pressure from sharp selloffs in global stock markets. The U.S. stocks note the largest daily drop from 2011 to delete the year's gains.

U.S. West Texas Intermediate crude futures reached at $66.22 a barrel, 0.9% below their last close.

Brent crude oil futures were at $75.41 a barrel 75 cents, or 1%, below their last close. Markets have been hammered from the beginning of the month by a series of concerns, including the China-U.S. trade conflict, a loss in developing market currencies, increasing borrowing charges and bond yields, as well as economic anxieties in Italy.