The market set new records on Wednesday and increased the Dow Jones Industrial Average rising around 200 points to beat the high it reached in August. The rise was due to upbeat earnings reports as well as a hefty increase in Bitcoin prices.
The Dow increased as high as 0.6 percent to reach a record-setting high before reversing gains a bit and the S&P 500 increased by 0.3 percent, just 0.2 percentage shy of its record. Investor confidence grew after the third quarter’s earnings increased over expectations. As of Wednesday morning, 86 percent of S&P 500 companies have outperformed expectations, according to Refinitiv data.
The shares of Verizon gained more than 2.2% after surpassing estimates of earnings earlier on in the day. Netflix as well as United Airlines both posted better-than-expected performance after closing on Tuesday.
However, the value of Bitcoin reached a record highest of $66,893 after several weeks of upbeat sentiment for the cryptocurrency. This comes following the release of an ETF that was the first to be linked with Bitcoin launched by ProShares it, gained during its initial trading day on Tuesday.
According to the Forbes estimates, in addition to the excitement, billionaire hedge fund manager Paul Tudor Jones is worth $7.3 billion. The following day, he said to CNBC that he would instead use Bitcoin over gold to hedge against inflation.
“Earnings remain the main driver of the advance as results continue to come in ahead of expectations,” says Vital Knowledge founder Adam Crisafulli. “Anticipation of a fiscal deal in Washington (a rough framework could be in place by the end of the week) and indications of Xi dialing back his regulatory campaign in China is also adding to the market’s enthusiasm.”
Since the highs that were previously recorded in August, the market has been hit by a myriad of causes, including covid delta, Covid delta variation, news of inflation rising, and the demise of stimulus funds from the government.
“Bitcoin’s bullish momentum could last a lot longer, but the global energy crisis should not be ignored,” writes Oanda senior market analyst Edward Moya. “Cryptocurrency energy consumption could draw scrutiny from many governments that are battling energy shortfalls,” Moya argues. Moya believes that the value of Bitcoin could well reach $75,000; however, getting the $100,000 mark is “difficult,” at least until the current global energy crisis is solved.