Important news came just after the global market closed.
Trump stated that he would nominate Bessent to be the next U.S. Secretary of the Treasury, inviting this key advisor to implement the broad economic agenda he promised to pursue during his second term. Just a day earlier (The Wall Street Journal) exclusive news came out that Trump was considering selecting former Federal Reserve Governor Warsh as Treasury Secretary and would nominate Warsh to lead the Federal Reserve after Powell's term as chairman ends.
In a statement, Trump said that Bessent has always been a steadfast supporter of the 'America First' agenda, and as our great nation approaches its 250th anniversary, he will help me usher in a new golden age for America while reinforcing our position as the world's leading economy.
The news is changing too quickly.
1. This news was announced after the global market closed and will subtly influence market trends next Monday. Bessent's role as U.S. Treasury Secretary may be interpreted by the market as a 'market-friendly' official.
Bessent stated in an article after Trump's victory that Trump's election led to the largest single-day gain of the dollar in over two years, as well as the third largest single-day gain in nearly a decade, which is a vote of confidence in America's international leadership and the dollar as the world's reserve currency.
This article was appreciated by Trump.
2. Bessent is the founder of the macro hedge fund Key Square Group and previously served as the Chief Investment Officer for George Soros, managing a significant amount of money. His investment background and deep understanding of capital markets may boost market confidence in policy-making, but Wall Street will also speculate on whether he will lean towards 'certain markets.'
3. So far, there is still no news regarding Lighthizer. If Trump nominates Lighthizer for Treasury Secretary, it would create chaos in the financial markets, but fortunately, that scenario did not occur. However, we are still closely monitoring Lighthizer's related appointments.
4. For Bessent, how to coordinate the relationship between Trump and Powell is key to determining the market and dollar trends. During Trump's first term, former Treasury Secretary Mnuchin played a crucial role. If the Treasury and Federal Reserve's policies are in sync (for example, in response to a recession), it would be a great fortune for the financial markets.
How the global market will move next Monday is likely of great interest to Bessent.
