Last Week's Recap
The US Market - Three major indexes hit new highs
The stock market rally skyrocketed after Donald Trump won the presidential election, with all three major indexes finishing the week at record closing levels and many leading stocks across key sectors boasting double-digit gains.
Donald Trump won a total of 312 votes in the election, compared with 226 for Harris. Republicans have control of the Senate and appear on the cusp of holding a narrow majority in the House.
The Dow had its best post-election gain since 1896, hitting record highs along with the $.SPX(.SPX)$ and $.IXIC(.IXIC)$ . Small caps index-Russell 2000 $iShares Russell 2000 ETF(IWM)$ skyrocketed 8.57% over the week. Since 2024, the benchmark and Nasdaq have risen 25.7% and 28.5%, while the Dow was up 16.7% this year.
The Fed provided the expected quarter-point rate cut and Chairman Jerome Powell remained just dovish enough to keep the Trump election rally going. Powell noted he was “feeling good” about the economy during a press conference following the change.
The US Sectors & Stocks - TSLA & Crypto-related stocks surged
All S&P 500 sectors gained for the week. The industrial sector was the top winner with a 6% weekly gain. Many leading stocks across key sectors boasted double-digit gains, such as $Morgan Stanley(MS)$ , $Goldman Sachs(GS)$ , $Intel(INTC)$ , $Oracle(ORCL)$.
$Tesla Motors(TSLA)$ skyrocketed 29% and back to a $1 trillion valuation on hopes that a Trump victory, strongly backed by CEO Elon Musk, will help the EV giant.
$Coinbase Global, Inc.(COIN)$ surged 48% for the week, which would make it its best week since January 2023, when it gained 50%. Moreover, crypto-related stocks such as $Riot Platforms(RIOT)$ , $Marathon Digital Holdings Inc(MARA)$ , $CleanSpark, Inc.(CLSK)$ all jumped as $Bitcoin(BTC.USD.CC)$ reached a record high.
$AppLovin Corporation(APP)$ skyrocketed 77% for the week to bring its gain for the year so far to over 600%. The online gaming and advertising company issued guidance that was well above estimates and reported better-than-expected earnings and revenue. The company became the top tech stock of the year.
$Palantir Technologies Inc.(PLTR)$ surged nearly 40% to a new high after the data analytics software maker guided up on revenue. The company beat on both the top-line and bottom-line. U.S. commercial revenue jumped 54%.
Cathie Wood’s ARK Innovation ETF was up 16% this week, registering for the best week since November 2023. Notable leaders in the fund this week include TSLA, COIN, PLTR and HOOD, which are believed to benefit from loose regulations under a Trump administration.
$Upstart Holdings, Inc.(UPST)$ the AI-focused lending marketplace surged 46% after third-quarter results surpassed Wall Street expectations.
$Boeing(BA)$ machinist union members on Monday voted to ratify a new contract and end the seven-week strike after reaching an agreement with the Dow Jones manufacturer. The deals deal includes a 38% general wage increase over four years, along with a $12,000 ratification bonus and beefed up retirement and disability incentives. Shares fell, hitting a two-year low.
Hong Kong Market - $HSI(HSI)$ advanced 1%
Hong Kong stocks advanced, driven by positive news from the recent FII summit, erasing earlier losses. For the week, the Hang Seng Index (HSI) was up 1% on speculation Beijing will boost and front-load its fiscal stimulus plan. Tesla suppliers rallied on mainland stock exchanges, betting on Elon Musk’s ties with incoming president Donald Trump.
“For China, the direct earnings impact from higher tariffs is likely to be limited” given that more than 85% of the revenue among the 700-odd members of the MSCI China Index comes from mainland China,” said Tai Hui, Asia-Pacific chief market strategist at JPMorgan Asset Management. “Beijing’s fiscal and monetary policies could offer some offset.”
Singapore Market - $STI.SI(STI.SI)$ was up 4.75%
Singapore shares rallied this week, with the STI up 4.75% in the last five trading days. The local stock market reacted positively to the results of US presidential elections. Three major banks all logged new record highs to push the benchmark to a new high on Friday.
$DBS Group Holdings(D05.SI)$ ) unveiled a multi-billion dollar share-buyback program, as wealth management fees and markets trading income drove third-quarter profit. DBS Shares Surge 9.4%.
$UOB(U11.SI)$ has excess capital of about S$2 billion to S$2.5 billion. Its CEO Wee Ee Cheong said will considered a share buyback. The stock jumped 11% as the lender reported higher-than-expected earnings for the third quarter, driven by record fees underpinned by wealth management. Trading and investment income also rose.
$ocbc bank(O39.SI)$ said it was firmly placed to achieve its 2024 targets after posting on Friday a 9% rise in third-quarter net profit that beat market expectations. Shares of OCBC rose 5.8% this week.
Australian Market - $S&P/ASX 200(XJO.AU)$ added 2.2%
Australian shares tracked a positive lead on Wall Street as expectations of lower interest rates despite the prospect of higher inflation in the US. On the week, ASX 200 added 2.2%, the best week since mid-August. All 11 sectors ended in the green, except energy as oil prices retreated.
$COMMONWEALTH BANK OF AUSTRAL(CBA.AU)$ reset its record high to $149.73 and closed at an all-time peak of $149.56. The other major banks rallied with Westpac (ASX: WBC) up 2.2% to $32.14, leaving one-step to record high. ANZ advanced 1.3% to refresh record high, despite reporting lower net profit and final dividend in fiscal 2024.
Goldman Sachs forecasts gold prices will rise to around US$3,000 per troy ounce by the end of 2025, with central banks in emerging markets ramping up purchases. The ASX's largest gold miner, $Newmont Corporation(MWL.AU)$ , has gained 11.2% this year. $DE GREY MINING LTD(DEG.AU)$ has enjoyed a 13.6% appreciation, while $REGIS RESOURCES LTD(RRL.AU)$ is up 15.6%.
The Week Ahead
Macro Factors - CPI on Focus
Inflation data in the week could determine whether a stock market that surged to all-time highs after Donald Trump’s decisive victory can continue to push higher.
The October Consumer Price Index (CPI) will release on Wednesday. The headline CPI is expected to have risen 0.2% on a month-over-month basis, the same as in the prior month, according to economists polled by FactSet. On a yearly basis, it’s expected to have ticked higher by 2.5%, up from 2.4% in the previous reading. Core inflation, which excludes volatile food and energy prices, is expected to have held steady at 0.3% and 3.3% on a monthly and yearly basis, respectively.
The October producer price index (PPI), which excludes shelter, is set to have risen 0.3%, consensus estimates show, up from a 0.0% reading the prior month. On a yearly basis, it’s expected to have risen by 2.3%, up from 1.8% previously.
Earnings
After the big rally, many investors continue to be bullish on the market because of a strong fundamental backdrop. Investors are wrapping up an upbeat third-quarter reporting season, with roughly 74% of the 450 S&P 500 companies that have reported thus far posting positive surprises, according to FactSet data.
The earnings season is winding down, but there are several key companies still on deck to report. $Home Depot(HD)$ , $Cisco(CSCO)$ ,and $Walt Disney(DIS)$ will highlight the week of earnings reports.
$.SPX(.SPX)$ $Invesco QQQ(QQQ)$ $SPDR S&P 500 ETF Trust(SPY)$ $Cboe Volatility Index(VIX)$ $HSI(HSI)$
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