Death of Osama Bin Laden causes rise in S&P futures but not the $USD

FX Strategy Articles > Fundamental articles

Early indications are that the death of Osama Bin Laden will cause a significant rise in the S&P 500 but not necessary a rally in the USD vs. cross currencies.

As shown by the chart below, the announcement of Bin Laden’s death caused an instantaneous sharp increase in the S&P 500 futures, which will most likely culminate in a significant rise in U.S stocks upon opening this week. This will be further welcome news to U.S investors who obtained their highest return in months last month.

The Death of Bin Laden, however, has not yet affected the USD, presumably because of the dire state of the economy and the fact that Bin Laden’s death will also have positive impacts for other countries, such as Great Britain, Australia and Canada, as well.  The charts below, which shows the 1 hour price pattern of the EURO/USD indicates that the USD has been relatively stable following the announcement, other cross currencies show a similar pattern.

Once the USD commences trading again on Monday, it will be interesting to see the extent of any rally.

Published on 2nd of May 2011
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