Without a doubt, Tesla CEO Musk is the biggest winner in the 2024 US presidential election after Trump.
This week, Tesla's stock price surged by 28%, with a total market value exceeding $1 trillion. Musk's net worth has also expanded, increasing by $52 billion in a week, and his net worth has reached $314 billion.
In addition to Tesla, the stock prices of other companies in the "Big Seven" of technology have also risen. Among them, Nvidia and Amazon both rose by over 11%. The total market value of seven companies has increased by $934.6 billion this week. Some analysts believe that this is because the Trump administration will bring policy benefits to American tech giants.
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In terms of other assets, the Dow Jones Industrial Average and the S&P 500 achieved their best weekly performance in a year. On Friday, the Dow Jones Industrial Average broke through 44000 points for the first time during trading, and the S&P 500 stock market briefly rose above 6000 points, setting its 50th new high of the year.
Goldman Sachs' Chief US Equity Strategist David Kostin believes that the reduction in political uncertainty will stimulate US stock market gains in the short term. By the end of 2024, the S&P 500 index is expected to reach approximately 6015 points, an increase of about 0.7% from the current level.
Outside of the US stock market, the US dollar, crude oil, and Bitcoin also saw significant gains this week. Among them, Bitcoin broke through $77000 for the first time, setting a new historical high. Spot gold fell 1.8% this week.
Silicon Valley becomes election winner, Musk's wealth grows by $52 billion in a week
According to reports, since publicly announcing his support for Trump in July this year, Musk has not only actively participated in campaign rallies, but also launched a high-profile "cash power" campaign to build momentum for him, reportedly investing a total of about 130 million US dollars.
This' gamble 'has also brought considerable returns to Musk. Tesla's stock price surged 28% this week, with a total market value exceeding $1 trillion. The other six tech giants also performed outstandingly, with stock prices rising across the board, with Nvidia and Amazon both rising by over 11%. The total market value of seven companies has increased by $934.6 billion this week.
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Under this push, the personal wealth of the founders or executives of the "Big Seven" (excluding Apple) has also skyrocketed, with a cumulative increase of $102 billion. Among them, Musk's net worth increased by $52 billion in a week, reaching $314 billion. This is also the first time in nearly three years that its net assets have exceeded 300 billion US dollars. NVIDIA CEO Huang Renxun came in second, with wealth rising by $11 billion in a week.
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Dan Ives, a senior stock analyst at WedBush, pointed out in an email to a reporter from the Daily Economic News, "We expect that the United States will introduce major AI plans, which will be beneficial for Microsoft, Amazon, Google, and other technology companies. AI plans will become the main driving force for AI companies
Ives believes that Tesla will be the biggest beneficiary of Trump's election victory. He analyzed that "Trump's election as president will be detrimental to the overall electric vehicle industry, as electric vehicle tax refunds/incentives may be canceled, but for Tesla, this is a huge positive factor. Tesla's scale and scope are unparalleled in the electric vehicle industry, which could give Musk and Tesla a clear competitive advantage
He further explained, "Trump entering the White House may also accelerate Tesla's (and Waymo's) FSD and autonomous driving plans. We believe that if autonomous driving/FSD accelerates development from 2025 and benefits Tesla's self driving taxi Cybercab, Tesla's stock price could rise by $40 to $50 per share
The Dow Jones Industrial Average broke through 44000 points for the first time during trading, the US dollar index rose for 6 consecutive weeks, and Bitcoin broke through $77000
The dust of the election has settled, how will major asset classes perform next?
Matt Quaife, Global Head of Diversified Asset Management at Fidelity International, believes that the uncertainty of the US presidential election has passed, the Federal Reserve has also started a cycle of interest rate cuts, and the fundamentals of the US market remain strong. Therefore, the current environment is expected to be favorable for risk assets.
The Dow Jones Industrial Average broke 44000 points for the first time
Driven by technology stocks, the Dow Jones Industrial Average and the S&P 500 achieved their best weekly performance in a year. On Friday, the Dow Jones Industrial Average broke through 44000 points for the first time during trading, while the S&P 500 rose above 6000 points, setting its 50th new high of the year. The Nasdaq also hit a new high. The three major indexes have accumulated gains of 4.61%, 4.66%, and 5.74% respectively in one week.
The reason why the financial market reacted so strongly to Trump's victory is closely related to his economic policy proposals during the campaign. He plans to relax regulations internally and impose new tariffs on most imported goods externally, with the new import tax rate generally reaching 10%.
Richard Francis, Senior Director of Fitch Ratings, stated in a comment email to Daily Economic News reporters that Trump's victory and the possibility of Republican control of both houses of Congress greatly enhance the probability of implementing Trump's core campaign policy commitments.
Goldman Sachs Chief US Equity Strategist David Kostin released a report stating that the stock market will rise in the short term, with a key factor being the reduction of political uncertainty. From a historical perspective, the S&P 500 index typically returns 4% from November election day to the end of the year. Goldman Sachs believes that if this trend continues this year, the S&P 500 index will reach approximately 6015 points by the end of 2024, an increase of about 0.7% from the current level.
However, due to concerns about the trade war, sectors such as the shipping industry will weaken. Meanwhile, the Republican Party's policy tilt towards the traditional energy industry has also led to a decline in renewable energy stocks. Investors believe that Trump may abandon the Biden administration's development direction in the fields of renewable energy and electric vehicles.
The US dollar index rose for 6 consecutive weeks
The US dollar index DXY has risen over 0.6% this week, with six consecutive weeks of gains, marking the longest consecutive week of gains since the end of June.
President elect Trump has won a strong mandate to implement the policies he proposed during the campaign, "analysts from Mitsubishi UFJ Financial Group wrote in a report. The situation of these policies remains unclear for some time, but investors may prepare for rapid implementation, which will support yields and boost the US dollar
Bitcoin rises by over $77000, reaching a historic high
The price of Bitcoin hit a new historical high on Friday, breaking through $77000 for the first time. According to CoinDesk data, the current price of Bitcoin is $77105, up about 0.64% from 24 hours ago.
Zhao Wei, a senior researcher at OKX Research Institute, pointed out to a reporter from the Daily Economic News that on the one hand, there is a possibility of changes in the regulatory policies of the United States regarding Bitcoin and cryptocurrencies, which may directly affect market sentiment and cause market fluctuations; On the other hand, changes in US economic policies will bring uncertainty to the overall economy and financial markets, while fluctuations in the US dollar and changes in multiple financial markets such as the US stock market will indirectly affect the cryptocurrency market.
In addition, multiple data such as the inflow and outflow of Bitcoin ETFs in the United States, the Federal Reserve's interest rate results, and the US CPI are also important factors that have a significant impact on the Bitcoin and cryptocurrency markets.
When there are significant changes in the overall environment, the market is often accompanied by stronger uncertainty and volatility, and Bitcoin, as a highly volatile asset, has a more pronounced perception and effect on market sentiment, and is prone to violent price fluctuations in a short period of time.
Inflation risk may push US bond yields to 5%
On the 6th, the yield of the 10-year US treasury bond bond hit 4.48%, the highest level since July last year, but fell 8 basis points throughout the week, and as of press release, it was 4.306%. Yardeni, an investment firm, predicts that if Trump's fiscal policies anger investors, yields may once again hit 5%.
Morgan Stanley's strategist team stated that the US Treasury is most afraid of a Republican sweep scenario. In this context, Trump will advance tax cuts and tariff plans, expand the fiscal deficit, increase US bond sales, restart the era of inflation, and push up US bond yields.
Francis told reporters in an email, "The Republican victory indicates that the debate on the federal debt ceiling in Congress in January next year is likely to be resolved without significant controversy. The tax cuts passed in 2017 may be extended next year. The additional tax cuts will push the already high federal deficit to even higher levels
Citigroup: Brent crude oil expected to drop to $60 per barrel by 2025
Brent crude oil futures fell 2.29% to $73.9 per barrel on Friday, up 1.09% for the week. WTI crude oil futures fell 2.65% to $70.43 per barrel, with a weekly increase of 1.35%.
Citigroup predicts in its latest research report that Trump's return will hit oil prices, with Brent crude expected to fall to $60 per barrel by 2025. Citigroup suggests that oil producers reduce their exposure to Middle Eastern risks in the next one or two months. It is expected that after Trump takes office, oil prices may come under pressure, and Brent crude oil prices are expected to average $60 per barrel in 2025.
Citigroup believes that Trump's new term may have a bearish impact on the oil market, and this political change may continue to put pressure on oil prices in 2025, although the risks of politics and sanctions policies may still support oil prices.
Golden Week fell 1.8%, analysts: Gold is a long-term positive trend
On Friday, COMEX December gold futures fell 0.52% to $2691.7 per ounce, down 2.09% for the week. Spot gold fell 0.8% to $2684.03 per ounce in late trading, down 1.8% for the week.
Shenyin Wanguo Futures believes that under more intense and universally targeted tariff policies and stricter immigration policies, the shortage of labor supply will drive inflation to continue to rise and further hinder the Federal Reserve's interest rate cut path. From a long-term perspective, this is beneficial for gold, but short-term risks are also heating up: whether the market will start trading under the inflation scenario, the tightening bias of the Federal Reserve's monetary policy.
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