To The Moon

My weekly commentary

The Trump Trade

At the close of US equities trading this morning many of the Trump trade stocks had begun to give back some of the huge price gains they have made in the past week since Donald Trump became President elect. The Crypto and Banking sectors jumped as many believe Trump will ease regulation for both sectors.

Coinbase had more than doubled in price in the past week before giving some back some of the gains today. Leading banking stocks were also slightly higher today with Dow components $JPMorgan Chase(JPM)$ and $Goldman Sachs(GS)$ up 9.5% and 15% respectively since last Tuesday.

Trump supporter Elon Musk’s Tesla also jumped as Tariffs on Chinese made EV’s imports to the US may be hit with tariffs of circa 50% under a Trump administration. Bitcoin ETFs Sare up more than 25% on average since last week but all closed slightly lower today.

Meanwhile $Tesla Motors(TSLA)$ closed 0.5% higher today but has been up as much as 43% in the past week.

You may interest to read:

My Video on all the Trump Trades: Bitcoin, Big Tech, Banks and Bets

US Earnings

The US earnings season continued this week. The highlight was the New Zealand/US listed space company Rocket Lab that rallied 28% today after reporting after market yesterday. The gain propelled founder Sir Peter Beck into the Billionaire club with his 10.5% ownership of the $.IXIC(.IXIC)$ listed company.

Next week $Wal-Mart(WMT)$ and $NVIDIA Corp(NVDA)$ report after the bell on Tuesday and Wednesday, respectively (US ET). Walmart is up 63% YTD while Nvidia is up 195% YTD.

Corporate America has never been better: Profits as a share of U.S. GDP hit a record 17%.

Rates and Inflation

This morning’s monthly Inflation and Core Inflation numbers were in line with expectations at 0.2% and 0.3%. CPI also met consensus.

As we know the US Federal Reserve lowered rates by 25-bps at last Friday’s FOMC meeting as expected and the probability of another 25-bps easing in December is now back up to 81% from 59% yesterday on these latest Inflation and CPI numbers.

One of the question marks about the Trump Presidency will be how policies will affect inflation and forward interest rates. Time will tell how this plays out.