Dow Jones reaches record high - is a crash imminent?

The Dow Jones closed above 20,000 points for the first time ever on Wednesday, with stock in US companies at a higher level than ever before. Stock markets in Asia and Europe also soared. Trump is giving investors a boost, commentators conclude, but warn that the rally on the markets could be short lived.

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De Tijd (BE) /

Dancing on the volcano

Investors are making a bundle thanks to Trump, but they are also taking huge risks, De Tijd warns:

“The investors are true cynics, focussed only on what President Trump can do for them in the short term. And that's a lot. … But this is not a story with a happy end, that's for sure. There's a Wall Street saying that investors climb a wall of worry. But it's clear that the geopolitical concerns are now looming over them like an Eiger North Wall. Can someone as unpredictable as Trump prevent a trade war with China? And will Washington be able to continue servicing its 20 trillion dollars in debt, particularly now that China is no longer on the buying side? … The vertigo of all those who don't want to climb even higher is justified.”

Les Echos (FR) /

Optimism may soon fade

The euphoria on the stock markets is utterly incomprehensible, Les Echos believes:

“It refuses to acknowledge all the factors that could destroy the desired rosy scenario. There are numerous 'natural' risks: from the current geopolitical instability to the unclear outcome of this year's elections in Europe to the risk of terrorism. To say nothing of the threats to the global economy that Donald Trump himself is creating: his plan to raise tariffs and the repercussions of his budget policy. ... The rise in value of the dollar is a first sign of new difficulties, and the consequences are still impossible to predict. A return to significant levels of inflation and an accelerated rise in interest rates may soon follow. In any event, that would nip investors' dreams in the bud and trigger a brutal realignment of the markets.”

Deutschlandfunk (DE) /

Mostly not down to Trump

It's not just Trump's election that is fuelling the stock market boom, Deutschlandfunk stresses:

“Even before Trump took office the share prices on Wall Street were climbing higher and higher. The reason: the US economy has visibly gained momentum, at below five percent the jobless rate is indicating near full employment and companies are making huge profits. … Above all the US companies themselves have managed to reposition themselves after the financial crisis. … The Obama administration also played a part in encouraging companies to invest again and getting people on the street back into jobs. So the fact that the stock market has hit the 20,000 milestone has little to do with Trump. But it does have something to do with him, because his promises to launch a huge stimulus programme and to slash taxes have definitely driven share prices upwards.”