DUBAI, UNITED ARAB EMIRATES/SINGAPORE/SAO PAULO/LONDON ¨C If emerging markets had their way, this Christmas week would be like any other: quiet, with just a handful of economic releases and low trading volumes. But political dramas playing out in the U.S. are keeping investors on tenterhooks.
The U.S. government shutdown over President Donald Trump¡¯s demand for border-wall funding is likely to last past Christmas. And even though Treasury Secretary Steven Mnuchin tried to reassure financial markets that Federal Reserve Chairman Jerome Powell wouldn¡¯t be ousted, investors are nervous. Last week, the S&P 500 Index suffered its biggest weekly loss since 2011.
¡°If equity markets fall further, they¡¯re going to set off machine-based selling,¡± Saed Abukarsh, the co-founder of Dubai-based hedge fund Ark Capital Management. ¡®The other risk is that experienced traders are on holiday, so the ones left will be trigger happy with every new headline. Meanwhile, most traditional risk takers haven¡¯t had a good year, and they¡¯re unlikely to add to their portfolios.¡±
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