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SHANGHAI (Reuters) - China's central bank vowed on Friday to crack down on illegal activities of cryptocurrency trading, banning overseas exchanges from providing services to mainland investors via Internet.
Cryptocurrencies were back up on Thursday, after being hammered in the past week, as acceptance by mainstream companies continues.
European stocks recovered some of yesterday's losses on Tuesday morning in London, as new data from the Office for National Statistics showed the UK's public sector borrowing had seen its second highest August on record.
Cross-chain DeFi platform pNetwork has been hacked on Binance Smart Chain to the tune of approximately $12.7 million worth of Bitcoin.
Biden will propose higher capital gains tax on the wealthy - Stocks and Bitcoin Sinks
Stocks erased earlier gains to trade sharply lower after Bloomberg reported Thursday afternoon that President Joe Biden would propose increasing the capital gains tax rate on wealthy individuals.
The Dow dropped more than 250 points, or 0.7%, immediately following the report, after trading just slightly lower earlier. The S&P 500 and Nasdaq erased gains to trade at session lows.
Biden's plan would involve increasing the capital gains tax rate on the wealthy to 39.6%, according to the report from Bloomberg citing people familiar with the matter. This would apply to those earning at least $1 million. The current base capital gains tax rate is 20%.
Earlier, in the session, stocks were little changed and struggled for direction. Stocks have churned in recent sessions as investors digested a bevy of corporate earnings results and awaited additional reports, more economic data and more commentary from Federal Reserve officials in the coming weeks.
Corporate earnings have so far exceeded Wall Street's even lofty expectations, as companies benefited from both a pick-up in revenue as demand recovered, and as cost-cutting measures implemented during the pandemic boosted their bottom lines. Chipotle (CMG) shares edged higher in early trading after the restaurant company posted first-quarter earnings that blew away expectations late Wednesday, with digital sales more than doubling.
With stocks hovering near all-time highs and the early stages of the post-pandemic recovery already under way, any additional moves higher will likely come with some difficulty, some analysts said.
"What we have is the absence of a catalyst. Everything that we’ve done over the last twelve months has been to build up to this point, to get this recovery, to get a very, very strong second-quarter GDP, which we think could be upwards of 10%," Jim Caron, Morgan Stanley investment management fixed income portfolio manager. "But after that, things start to slow down. It doesn’t mean that the data gets bad, it just means on a relative basis that the third quarter will be weaker will the second quarter and the fourth quarter may be weaker than the third quarter."
Looking forward, the contours of additional government spending and monetary policy support will likely serve as key drivers, Caron added.
"We have an infrastructure spending plan that’s also coming out ... And once we have that, we’ve already spent $5.8 trillion, we’re going to spend some more, we’re going to have a very large deficit, so then what comes next? The next 12 months of fiscal spending is probably going to be less than the last 12 months," Caron added. "So that seems like a net tightening. And then we have Fed tapering to throw into the whole thing as well. So the market’s realizing that it has some hard work to do."
Others offered a similar view.
"I do think that returns for equities are certainly going to be more subdued. I mean, we did have a very strong recovery from the bottom that we’ve seen. But now we are bumping up against price targets. We’re probably about 5% away from our year-end price target," Anastasia Amoroso, JPMorgan Private Bank head of cross asset thematic strategist. "It’s possible that as long as the earnings revisions come through and they’re higher, we’ll revise that. But I think there’s going to be not as big of a beta rally going forward. There’s going to be more discerning investments needed in the markets."