All-Time Highs: Will Stock Market's Next Trend Be Elections or AI?
After Trump’s election victory yesterday, US stocks $.SPX(.SPX)$ hit all-time highs across the board. Plus, there are some standout stars from this earnings season that shouldn’t be overlooked. Check out this week’s 'New Highs' column!
1. $Morgan Stanley(MS)$ closed at $131.49 with a year-to-date increase of 41.01%.
During his campaign, Trump expressed an intention to reduce corporate tax rates from 21% to 15%, which would be positive news for the banking industry.
With lower tax rates, bank profits would naturally rise, boosting investor confidence. Trump has also advocated for reducing regulatory burdens, allowing the banking industry to operate in a more relaxed environment.
2. $BlackRock(BLK)$ hits $1057.51 with a year-to-date gain of 26.86%.
Similarly as $Morgan Stanley(MS)$, Trump’s measures are aimed at making financial markets more active and enabling the banking sector to develop with fewer restrictions.
Additionally, the chairman of BlackRock has spent millions supporting Trump’s campaign.
3. $AppLovin Corporation(APP)$ surged 28.33% in premarket trading with a staggering 322.96% year-to-date.
The company reported $1.2 billion in revenue, exceeding the expected $1.13 billion.
Earnings per share (EPS) came in at $1.25, beating the analyst consensus of $0.92 by $0.33.
The success of AppLovin’s AI-driven advertising technology, AXON, was a key factor in its strong performance. AXON improves ad targeting precision and completes large-scale ad auctions within microseconds, significantly enhancing advertiser return on investment.
The company expects to maintain steady growth and healthy profit margins over the coming quarters, with stronger financial performance likely as it releases new products and meets rising market demand.
4. $Astera Labs, Inc.(ALAB)$ rose to $98.68, a year-to-date increase of 172.69%.
Astera Labs provides data center connectivity semiconductors to improve efficiency and speed between software and hardware, optimizing data transfer to support AI and high-performance computing needs and accelerating the operation and responsiveness of AI applications.
Astera Labs shares jumped approximately 30% on Tuesday morning after the Nvidia supplier reported strong third-quarter earnings, driven by demand for its AI products.
Adjusted EPS was $0.23, compared to the expected $0.17.
Revenue reached $113.1 million, surpassing the forecasted $97.5 million, marking a 206% year-over-year increase.
Astera Labs projects fourth-quarter revenue of $126 million to $130 million and EPS of $0.04 to $0.06.
5. $Amazon.com(AMZN)$ reached an all-time-high of $207.55 with a year-to-date growth of 36.3%.
Amazon is also considered a tech company supportive of Trump. Last week, Washington Post owner Jeff Bezos declined to endorse Vice President Harris.
Additionally, Amazon significantly outperformed expectations in its earnings report last week:
Amazon’s Q3 2024 revenue grew to $158.9 billion, an 11% increase year-over-year.
Operating income surged 56% to $17.4 billion, with AWS revenue growing 19.1%.
Free cash flow over the past 12 months reached $46.1 billion, an increase of 128%.
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