MARKETS WRESTLE METHOD & MADNESS OF TRUMPONOMICS

Optimism held sway till headlines spooked the bulls.

- SHANKKAR AIYAR Author of The Gated Republic, Aadhaar: A Biometric History of India's 12 Digit Revolution, and Accidental India ([e-mail])

Global indices flirted with or shot past 52-week highs as the news flow propped bullish sentiments. The US benchmark S&P 500 touched a new high of 6,187, tech tracker Nasdaq shot past 20,311, Japanese Nikkei 225 hovered at 40,267, Korean Kospi touched 3,093, and India's Nifty 50 surged past 25,650 towards its all-time high, while in London the FTSE 100 nudged 8,798.

Donald J. Trump was talking up trade deals. A deal with China signaled business as usual for markets even though little is known beyond access to rare earth minerals and magnets discussed at the London détente. A deal with India—"a big one which would open up India," in Trump's words—was on the anvil, Vietnam was moving ahead and the European Union was edging closer to a deal, prompting the US to scrap the "revenge tax".

The whiplash of headlines followed soon enough. Just as punters settled for siesta, DJT declared, "We are hereby terminating ALL discussions on trade with Canada, effective immediately." The reason: Canada's move to implement a digital services tax of 3 percent. Predictably, the Canadian S&P TSX slid, as did S&P 500 and Nasdaq before recovering at close. Tremors and shocks are a constant cause of volatility since Trump took office. Traders who coined the term TACO (Trump always chickens out) believe Trump's love for a buoyant stock market will save the day.