World stock markets retreated today and the dollar sank, amid investor disappointment over a lack of policy detail from United States President-elect Donald Trump and allegations of emissions cheating at Fiat Chrysler.
Fiat Chrysler shares, listed in both Milan and New York, skidded sharply lower after US authorities accused it of cheating emissions tests on diesel trucks and SUVs.
On Wall Street, Fiat Chrysler's stock fell 14.5 per cent shortly before 1655 GMT.In Milan, they closed 16.1 per cent lower.
US stocks had already been heading south by mid-morning after a press conference by President-elect Donald Trump yesterday, his first since the summer, failed to deliver policy specifics on anticipated economic stimulus.
Major US indices have rallied since the election, with the Dow Jones Industrial Average coming to within shouting distance of the 20,000-point milestone, on hopes of a Trump stimulus package this year along with deregulation and tax cuts.
However, "far from being the catalyst for the next leg higher in the 'Trump rally', The Donald's press conference seems to have called a temporary top," said Jasper Lawler at London Capital Group.
"The publishing of the unsubstantiated intelligence dossier seemed to have rattled the President-elect and probably shifted the emphasis of the presser. Markets were waiting for 'pro-growth' Trump and they got 'fake news' Trump."
All was not lost, though, the expert said.
"Not talking about fiscal stimulus on this occasion, doesn't mean it's cancelled."
Nevertheless, Chris Beauchamp at traders IG was more sceptical.
"In reality, the surge (of world stock markets) was already running on air, with US markets in particularly having essentially gone nowhere since mid-December," he said.
"This fact was masked by the ongoing hope of Dow 20,000, but it looks like this has been scrubbed from the timetable for the next few weeks."
At Trump's first-ever post-election news conference yesterday, traders had hoped the real estate tycoon would flesh out some of his campaign promises such as tax cuts and infrastructure spending.
But he gave very little away, fuelling uncertainty about his aspiration to boost the US economy.
However, he did lash out at drugs companies for "getting away with murder" in offshoring production and overcharging, which weighed on the pharmaceuticals sector.
Investors did not seem impressed by Trump's performance, analysts at Moneycorp said in a note.
"What they had been hoping for was stuff about tax cuts, infrastructure spending and financial deregulation. What they got was gripes about US intelligence services, unsupportive newspapers, Mexican imports and the price of medicines. The whole thing smacked more of tariffs and protectionism than of stimulus," the note said.
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