Market reaction to possible Donald Trump victory in 2024 presidential election, company reviews
Stock market news
• Markets were wild, with the dollar and Wall Street futures rising and Treasuries suffering as early presidential election results favored Republican Donald Trump.
• Several key swing states had yet to be called, but betting sites were strongly favoring Trump, with the NY Times real-time forecast projecting a 91% chance of his victory. Analysts believe Trump's plans to curb immigration, cut taxes and impose massive tariffs, if enacted, would put more upward pressure on inflation and bond yields than Harris's center-left policies. Trump's proposals could also boost the dollar and potentially limit the scope for lower U.S. interest rates.
• Markets remain confident that the Federal Reserve will cut interest rates by 25 basis points on Thursday, with next-year futures falling into negative territory after falling 8 basis points in December.
• The risk of a higher terminal federal funds rate, coupled with the prospect of ever-larger budget deficits, has hammered Treasuries, sending 10-year yields to four-month highs and two-year yields to a three-month high. Ten-year yields last rose 17 basis points to 4.449%, their sharpest gain since April. The jump in yields has fueled bullish bets on the dollar, which posted its biggest one-day gain since early last year. The euro, yen and Swiss franc fell more than 1%, while the trade-exposed Australian and New Zealand dollars fell to three-month lows.
• China's yuan fell on concerns that Trump would follow through on plans to impose punitive tariffs on Chinese goods. Wall Street was eagerly awaiting promised tax breaks and loosening corporate regulations, with S&P 500 futures up 1.2% and the Nasdaq up 1.3%.
• European stock futures were less enthusiastic as Trump's tariffs, if enacted, could spark a global trade war and threaten EU exports. There was also the risk of Trump leaving NATO, which would force Europe to spend more on defence while emboldening Russia in its territorial ambitions.
• Yesterday, the stock market began preparing for Trump's victory and grew by just over 1%. TSLA was the growth leader - Elon Musk is closely associated with Trump. In the morning, the Trump deal gained even more size. In addition to the growth of stocks, where small-cap stocks are already the leaders, the strong movement was joined by - the growth of bitcoin to a new historical record, a sharp decline in the prices of long-term government bonds, and the growth of the USD by 1-2%.
In Asia, the Japanese Nikkei is growing by 2%, rejoicing at the weakening of the yen and the growth of stocks in the United States. But in Hong Kong, there was a fall of 2%.
• Apple is exploring smart glasses - Bloomberg Its Vision Pro headset has yet to become a mass-market product. The initiative, code-named Atlas, launched last week and involves gathering feedback from Apple employees on smart glasses.
• Traders build largest-ever long position in US stock futures, now worth over $300 billion - Goldman Sachs
Elon Musk has suggested Twitter/X could be shut down if Kamala Harris is elected US president. In a new interview with Joe Rogan and Elon Musk, the entrepreneur compared the US Center for Countering Digital Hate to Orwell's Ministry of Truth.
According to the X owner, the censorship structure is pushing advertisers to boycott his platform, but he considers its functionality an important part of his fight against attacks on free speech. In October, losses from hacker attacks amounted to $88.5 million
• PeckShield platform analysts published a report on the losses of cryptocurrency companies from hackers. According to them, in October 2024, market players lost almost $88.5 million. The largest volume of assets during this period was lost by the Radiant Capital protocol - $53 million.
• Expectations of a Trump victory and a strong US economy gave the dollar its best month in 2 years, - FT.
• British pension company Cartwright helped the first UK pension fund invest in BTC - Coindesk. Now there is no shame in front of the grandchildren.
• China plans to sell up to $2 billion in dollar bonds in Saudi Arabia next week, BBG says, marking the first dollar debt issue since 2021.
• U.S. Bitcoin exchange-traded funds saw record daily outflows ahead of election day, BBG reports. A group of 12 funds managed by BlackRock, Fidelity Investments and others lost $580 million on Monday as traders braced for a period of heightened volatility after the U.S. election.
• Altcoins Become Riskiest Cryptocurrency as Election Approaches - Bloomberg After Bitcoin as a whole has underperformed for much of this year, smaller cryptocurrencies like Doge and Solana could take center stage once the U.S. presidential election is over.
• Instagram will use AI to reveal the true age of teenagers. The software can look at a user's profile, their list of followers and the content they interact with, and even scan "happy birthday" posts made by friends to predict the user's age.
• Amazon Still Stands by Talen Nuclear Deal Despite Regulatory Rejection Amazon has said it intends to build a data center campus adjacent to a nuclear power plant in Pennsylvania.
• Copper rose for a third day on hopes Beijing will announce more support measures, with analysts saying prices could continue to rise after the US election results are known.
• French and Dutch investigators raid Netflix offices over suspected financial irregularities - Bloomberg.
• Cummins beat third-quarter profit estimates, sending shares up 9%, thanks to strong demand for its data center power generation products.
• The world's third-largest contract chipmaker GlobalFoundries on Tuesday forecast fourth-quarter revenue above Wall Street estimates, as rebounding demand for semiconductors from smartphone makers sent shares up nearly 10% in pre-money trading.
• Burger King, Popeyes restaurant brands sales fall. Restaurant Brands International, the owner of Burger King and Tim Hortons, posted sales that grew more slowly than expected in the third quarter, underscoring the struggle of many chains to attract diners struggling with higher costs. The QSR's shares fell 3%.
• Harris win could give yen a boost, Trump could deepen slump - Bloomberg A victory by Kamala Harris in the U.S. presidential election could support the weak Japanese currency, while a victory by Donald Trump would likely give a boost to the Tokyo stock market and put the yen at risk of a deeper slump.
• The U.S. stock market is unlikely to turn into a bear market in the next 12 months as a robust economy will continue to support stocks,
according to Goldman Sachs strategists.
• Saudi Aramco faces dilemma over $31 billion dividend payout as debt soars Saudi Aramco will have to make a big decision early next year: Cut its $31 billion quarterly dividend and risk worsening the kingdom's budget deficit, or continue to borrow to maintain its payout.
• SMCI shares fall another 16% to $23 in after-hours trading. The special committee found no wrongdoing: the audit committee “acted independently and there is no evidence of fraud or misconduct by management or the board of directors.”
However, Super Micro still cannot predict when it will be able to file its delayed Form 10-K, which was due on August 29. That is worrying investors who fear a possible delisting if the company does not make the investment by the November 16 deadline.
The company said it “intends to take all necessary steps to comply with Nasdaq listing requirements as soon as possible.” But first, the company needs to find a new auditor to replace the fledgling EY.
Super Micro (SMCI) Faces Delisting, S&P 500 Exclusion Amid Auditor Problems - Bloomberg
• Musk now says it "doesn't make sense" to build a $25,000 Tesla for human drivers.
• Yum Brands reports unexpected drop in global sales amid KFC's problems in the US.
• Shane and Temu are preparing for a UK court case in 2026 over copyright and competition matters.
• Walmart and other U.S. retailers are importing fewer Christmas items ahead of a cool holiday season.
• Burger King and KFC owners miss earnings expectations as fast-food spending shrinks
• Ferrari's core profit rose 7%, helped by product range and personalisation.
• Emerson offers to purchase the remaining shares of AspenTech at $240 per share.
• Data analytics company Palantir is growing as artificial intelligence advances rapidly, helping to drive trustworthy software. Palantir shares jump to a record high as AI power projections rise.
• Thomson Reuters reports third-quarter revenue growth.
• Wells Fargo has tripled its political spending on government groups over the past decade.
• FinecoBank forecasts record income in 2024 due to increased fees.
• Apollo's third-quarter profit rose 12%, beating estimates.
• Oaktree's Banca Progetto has been raided as part of an investigation into fraud with public funds.
• Spanish banks offer moratorium on loans to households and businesses affected by floods.
• Schroders hit by big client exits, shares fall
• UK's TP ICAP reports record third-quarter revenue on strong global brokerage capabilities.
• Hong Kong hedge fund Zeal Asset to close and return money to investors.
• Japan's MUFG hires Rafael Charon to grow direct lending business in EMEA.
• China has given Morgan Stanley approval to open a local futures unit.
• Google dismisses gift card fraud lawsuit.
• The U.S. needs to crack down on Chinese chipmaker SMIC, a Republican lawmaker said.
• Broadridge Financial's earnings beat expectations, driven by strength in global technology unit.
• GlobalFoundries forecasts upbeat fourth-quarter results thanks to strong demand from smartphone makers.
• Gartner raises annual forecasts for robust demand in key research unit.
• Emerson offers to buy the rest of AspenTech for $15 billion to strengthen focus on automation.
Stocks yesterday after earnings:
Palantir (PLTR) +23%
APO +7%
EMR +7%
VRTX +6%
TRI +4%
MPC +3%
PGR +3%
RACE -7%
Key events that could impact markets on Wednesday:
- EZ Services PMI for October, Producer Prices for September.
- German Industrial Orders for September.
- US Services PMI for October.
Fundamental news
• Trump is leading in the US elections. And the Republicans will probably take the Senate. The battle for the lower house of Congress is still ongoing and here the Democrats have a chance to regain control. The New Yorker published an article about Americans preparing for a second Civil War.
They are building shelters, buying weapons. Everything is as usual.
• Harris has been supported with money or public statements by 83 billionaires from the United States, Trump - 52, according to calculations by the American Forbes, as of October 30. In total, the campaigns of both candidates have raised $2.62 billion, according to statistics from the Federal Election System, which was analyzed by the research group Open Secrets.
• US economic data (October):
S&P Composite PMI = 54.1 (previous 54)
S&P Services PMI = 55 (previous 55.2)
ISM Services PMI (Oct) = 56 (54.9 previous)
US services sector grew at fastest pace in more than two years in October, - BBG.
• UK economic data (October):
Composite PMI = 51.8 (previously 52.6)
Services PMI = 52 (previously 52.4)
A third of goods and services in the UK's 'consumer basket' have slipped into deflation, the highest since spring 2021 - BBG.
This strengthens the case for the Bank of England to cut interest rates on November 7.
• Chancellor Olaf Scholz's ruling coalition could fall apart this week. When the so-called "coalition commission" meets in the Chancellery on November 6 - Deutsche Welle. The reason is Finance Minister Christian Lindner's proposals to overcome the economic crisis. Lindner wants to reduce taxes for wealthy Germans and at the same time reduce social assistance and subsidies for the poor.
• The European Union's anti-fraud office OLAF has launched an investigation into a loophole that allows countries such as Turkey to export sanctioned Russian oil to the EU under a different brand - Politico, citing two sources.
• The European Union and South Korea will cooperate in the field of defense - Deutsche Welle. The agreement was reached at a meeting between the EU High Representative for Foreign Affairs and Security Policy Josep Borrell and the Minister of Foreign Affairs of the Republic of Korea Cho Tae-yeol.
• The Israeli Prime Minister has fired Defense Minister Galant. Foreign Minister Israel Katz will be appointed in his place.
• A Russian court has fined Apple for failing to remove two podcasts, RIA reports.
• Russia launched a Soyuz rocket carrying dozens of satellites, including two from Iran.