To The Moon

Stocks rose again on 08 Nov (Friday) with an extended post-election rally that has pushed major indexes to a series of record highs during a busy week marked by quarterly earnings releases, a rate cut from the Federal Open Market Committee (FOMC), and the conclusion of congressional and presidential elections.

The S&P 500 and Dow Jones Industrial Average gained 0.4% and 0.6%, respectively, while the Nasdaq Composite tacked on 0.1%. Each of the major indexes hit record closing highs and posted weekly gains of around 5%, with the S&P 500 and Dow having their best weeks since last November.

The stock market has been boosted by investor optimism about Donald Trump's decisive victory in the presidential election and the Federal Reserve's moves to cut interest rates. Investors were relieved by the election outcome, anticipating that President-elect Trump's plans to lower tax rates and reduce regulations would stimulate economic growth.

Strong Sentiment Reflected In Several Areas

We saw small-cap stocks soared. Financial stocks surged. The U.S. dollar strengthened against major currencies. Bitcoin prices increased significantly. Cyclical sectors outperformed.

The FOMC's decision to cut the fed funds rate by 25 basis points to 4.50-4.75% did not hinder the market rally. The Fed Chair, Jerome Powell, emphasized that policy decisions would be made on a meeting-by-meeting basis and did not rule out further rate cuts in December. He also noted that the Fed is unable to model for Trump's proposed policies due to a lack of specifics.

S&P 500 Utilities And Real Estate Sector Gain The Most

Utilities stocks was up on Friday (08 Nov) and Vistra (VST), Constellation Energy (CEG) and NRG Energy (NRG), are up more than 30% this year, these utilities stocks are getting a lift from demand for AI. Large language models, like ChatGPT, require massive amounts of electricity to train their databases.

Consumer Discretionary sector got a boost from Tesla (TSLA) as standout performer, benefiting from the idea that Elon Musk's support for Trump would be advantageous for the company, with shares rising 29.0% over the week.

Note Yield Down For Two Consecutive Days (Thursday and Friday)

The yield on 10-year Treasurys, which fell sharply on Thursday, was down again on Friday at around 4.31%, versus 4.34% at the close on Thursday.

The yield had been rising steadily in recent weeks as market participants reassessed their expectations for how aggressive the Fed would be in cutting interest rates in the months ahead.

Stocks To Watch

$Salesforce.com(CRM)$ is making a significant move by planning to hire 1,000 new employees to advance its generative AI platform, Agentforce. This expansion aims to capitalize on the growth of AI agents capable of autonomous business operations. This development follows Salesforce's partnership with Google Cloud (GOOGL) and Nvidia (NVDA) to enhance these capabilities. Salesforce shares saw a 3.5% increase, reflecting investor optimism about the potential multi-billion dollar opportunity this new platform represents.

This move would likely going to benefit Alphabet and Nvidia stocks as they would be spending more in their advancing of Salesforce generative AI platform. If we looked at how CRM have been performing from the technical (MACD and MTF), there is so much potential upside and it is currently in a strong uptrend. This should put CRM in a good position as they continued to build on advancing their generative AI platform to make a differential on the AI software space.

$Alphabet(GOOGL)$ would be seeing more spending coming from CRM, as they would need to run their workload on the Google Cloud and we are already seeing strong performance from GOOGL last week’s rally where MACD is in an upside movement and MTF is giving a strong uptrend.

I am holding my position for GOOGL for long term as this is one of the cloud provider that would benefit largely from the AI adoption as we are already seeing coming from CRM.

$NVIDIA Corp(NVDA)$ chips demand would be increasing as we know that generative AI advancing would require more processing power, this would see more buying of NVDA chips to help run the workload for CRM, and NVDA has been showing strong MTF uptrend, and there is a bullish MACD crossover formed.

So I am expecting NVDA to make a move above $150 this week. I am holding my position on NVDA as I am expecting NVDA to cross $180 by end of 2024.

$Costco(COST)$ achieved an all-time high of $962.00, outperforming retail giants Walmart (WMT) and Target (TGT) amid investor optimism post-U.S. elections. The retailer reported strong core comparable sales growth of 6.5% for October, with total net sales up 7.2%. Analysts attribute this success to strategic membership enhancements and the rollout of card scanners, which have boosted membership counts significantly at select locations.

$Tesla Motors(TSLA)$ surged 6.7% to exceed a $1 trillion market cap, driven by expectations of accelerated delivery growth and autonomy advancements. The U.S. election results are seen as favorable for Tesla, with potential regulatory relaxations benefiting the EV sector. Tesla's valuation now surpasses the combined market cap of the next ten largest auto manufacturers.

Archer Aviation (ACHR) rallied after updating on its progress towards FAA type certification for its eVTOL aircraft. The company is advancing through the final phase of certification, with plans to complete its manufacturing facility soon. Archer's focus remains on building aircraft for testing and early commercial deployment, positioning it for future growth in the urban air mobility market.

Summary

We might see some profit taking today (11 Nov) as we navigate through some of the earnings this week, there will be some focus on consumer staples as we are seeing strong performance from COST, there might be some correction on TSLA stock price, and we should be seeing some strong movement from mega cap.

Appreciate if you could share your thoughts in the comment section whether you think this week we will see post-election rally continuing after some profit taking activities run for a while.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.