The Trump administration is reportedly preparing to announce Kevin Warsh as the next chairman of the Federal Reserve on Friday, replacing Jerome Powell, a development that has rattled markets and sparked a widespread sell-off across asset classes.
As a result, risk sentiment has deteriorated as investors weigh possible changes in the direction of monetary policy.
Meanwhile, the DXY index, which tracks the strength of the US dollar against a basket of major currencies, has risen to 96.6.
US Treasury yields are slightly higher, with the benchmark 10-year yield at around 4.25%.
Volatility has increased: the Volatility Index (VIX) is up 13% and the MOVE Index, which tracks volatility in the US Treasury market, is up 6%.
In premarket trading on Friday, the Invesco QQQ (QQQ) is down more than 1%, trading around $622 per share.
Bitcoin has fallen significantly, falling to $82,000. As a result of this drop, bitcoin has fallen out of the top ten global assets by market capitalization and now ranks eleventh, with a market capitalization of $1.6 trillion.
Bitcoin-linked stocks have followed suit. Strategy (MSTR), the largest publicly traded holder of bitcoin, is down 4% in pre-market trading after falling about 10% on Thursday, now trading near $138. In the bitcoin mining and artificial intelligence sector, IREN (IREN) is down 5% to $57, while Cipher Mining (CIFR) is down 4%. While both Galaxy Digital (GLXY) and Coinbase (COIN) are down 3%.
Metals have absorbed much of the decline over the past 24 hours. Gold has retreated towards $5,000 an ounce, while silver has fallen back to around $100 an ounce. Other commodities have also weakened, with both copper and oil trading lower.
