US closing bell: S&P 500 up 2.5%, Nasdaq jumps 3%, Dow soars 1,500 pts after Trump win; Russel 2000 up 5.9%

US stocks soared to record highs as Donald Trump's presidential win and a potential Republican-led Congress fueled bets on pro-growth policies. The S&P 500 surged 2.5%, marking its best post-Election Day in history, according to Birinyi Associates and Bloomberg. Small-cap stocks rallied 5.8%, benefiting from Trump's protectionist stance, while banks gained on expectations of lower taxes and lighter regulations. Medicare-focused insurers also jumped on anticipation of higher government payments.

The Dow Jones Transportation Average reached a new high, confirming gains in the industrial sector and signaling broader market strength under Dow Theory. Wall Street's fear gauge, the VIX, saw its largest drop since August, and trading volumes spiked amid optimism for a business-friendly administration. The dollar experienced its strongest day since 2022, and U.S. yields jumped.

Ford and General Motors are "well positioned" to gain from Trump administration policies, according to Bank of America. Analysts noted that Ford and GM's highly profitable truck businesses, which would have been challenged by stricter decarbonization and EV mandates, are likely to thrive under expected regulatory easing.

However, higher tariffs on imported components from Mexico could pose risks due to Ford and GM's exposure there. Electric vehicle makers may also see slower demand with reduced pressure to shift to EVs and fewer government incentives. While Rivian and Lucid shares reflect this outlook, Tesla is expected to face fewer challenges due to its established profitability and forthcoming entry-level models.

BofA rates Ford, GM, Tesla, and Rivian as "buy" and Lucid as "neutral."

Select Water shares surged 26% after the company reported third-quarter adjusted EBITDA and revenue that exceeded analysts' expectations.

Montrose Environmental shares dropped 9% after BofA Global Research downgraded the stock from "buy" to "neutral," citing expectations of slower progress in federal environmental regulation.

With Donald Trump’s return, Citi anticipates gains for sectors like financials, communications, energy, and private prisons due to expected regulatory rollbacks and a friendlier stance toward oil and gas. Banks may benefit from deregulation, although widening spreads are possible if Treasury yields shift. Meanwhile, Trump’s trade policies, especially tariffs and a tougher stance on China, could pressure retail and global gaming sectors.

Despite Trump’s likely opposition to the Inflation Reduction Act, Citi notes that renewable energy tax credits are expected to remain intact, as they largely benefit Republican districts. Citi also recommends a compression strategy in credit default swaps and broader cash compression.

Semiconductor stocks climbed Wednesday in a broader market rally following Donald Trump’s election. Nvidia surged over 4%, lifting the VanEck Semiconductor ETF (SMH) by 2.4%, while Advanced Micro Devices gained 1.7%.

Kennametal shares jumped 16% after the toolmaker reported first-quarter adjusted earnings per share that surpassed analysts' average estimates.

Cytek Biosciences shares surged 31% after the company reported third-quarter revenue and adjusted EBITDA that exceeded average analyst expectations.

Clarivate shares plunged 27% after the analytics company withdrew its financial outlook, with management describing its third-quarter results as “unsatisfactory.”

Coinbase shares surged more than 30%, marking its best day since its direct listing in April 2021. The rally came alongside a broader surge in risk assets following Donald Trump’s victory in the US presidential election. Bitcoin also soared, climbing 7% to reach a new all-time high above $75,000.

Super Micro Computer’s shares tumbled 24% after the company forecasted December quarter revenue between $5.5 billion and $6.1 billion, falling short of analysts' expectations.

Donald Trump’s plans for trade tariffs, fiscal expansion, and tighter immigration could fuel inflation in the US, putting pressure on emerging-market (EM) equity returns, according to Schroders. The risk of rising tariffs, especially on China, could lead to a stronger dollar, higher yields, and reduced US monetary easing—factors that are broadly negative for EM stocks. High tariffs may prompt a significant Chinese policy response, but the exact timeline of their implementation remains uncertain. Schroders also notes that Trump’s isolationist stance could raise risk premiums in certain EMs. While China weakens and Fed-sensitive Asian markets soften, India is seen as more defensive due to its lower exposure to Trump’s policies.

Gold and copper plunged following Donald Trump’s victory, with a soaring dollar weighing on commodities. Gold experienced its biggest drop since June, while copper saw its largest decline since May. The surge in the dollar, which is on track for its best day since 2020, made metals more expensive for global buyers. Trump’s win, alongside Republican control of the Senate, led traders to lock in profits after gold's 4.2% gain in October, driven by safety bets during the uncertainty of the election.

US Treasuries were sold off amid expectations that Trump’s proposed higher tariffs would drive up consumer prices and increase government spending, potentially expanding the national debt. As a result, the benchmark 10-year Treasury yield climbed to 4.48%, its highest level in more than four months.

The Bank of England is expected to reduce interest rates by 0.25% this week, but uncertainty over Donald Trump’s second term raises doubts about future policy easing in the UK. Trump’s proposed tariff hikes could trigger inflationary pressures across Europe and China, according to JP Morgan, while Citigroup warns that trade shifts could weaken UK growth and slow price increases. Despite this, markets anticipate two more rate cuts by the end of 2025, with a 35% chance of a third. Goldman Sachs revised its UK GDP forecast down to 1.4% from 1.6%, citing increased trade tensions and geopolitical risks. (Bloomberg)

Donald Trump’s victory in the 2024 presidential race raises uncertainty for the US economy and the Federal Reserve’s policy outlook. Trump's proposed policies, including aggressive tariffs, expanded tax cuts, and stricter immigration measures, could increase inflationary pressures and widen the federal deficit. These challenges complicate the Fed's task of controlling inflation while maintaining job growth. With Trump potentially targeting Fed Chair Jerome Powell, central bank officials may tread carefully in their upcoming decisions. The Fed is expected to lower rates by 0.25% this week, with further cuts planned into 2025, but may now reassess their pace due to Trump’s economic agenda. (Bloomberg)

Oil prices fluctuated as optimism over Donald Trump’s election win clashed with bearish US market data. West Texas Intermediate (WTI) held near $72 per barrel after dropping 3.1%, while Brent was slightly lower around $75. Trump’s victory spurred stock gains, higher bond yields, and a stronger dollar, but oil was pressured by rising US inventories of oil, gasoline, and distillates. Meanwhile, Hurricane Rafael threatened US Gulf production, with Chevron shutting in operations and Shell evacuating personnel. Despite these factors, oil has fallen more than 10% since June, weighed down by weak demand from China and rising supplies in the Americas.

S&P 500 mid-cap stocks reached a new intraday all-time high, driven by strong gains in financials, along with boosts from tech and steel sectors. The index rose 3.3%, heading for a four-day win streak and its best performance since November 2023. Notable movers included International Bancshares (+14%), Evercore (+12%), Synovus Financial (+14%), Cleveland-Cliffs (+13%), and Qualys (+14%).

JPMorgan has updated its 2025 Federal Reserve rate outlook following Donald Trump's election win, predicting quarterly rate cuts starting in March. The bank expects the Fed to reduce rates by 0.25% in both November and December, then continue with quarterly cuts until the federal funds rate reaches 3.5%. Economist Michael Feroli noted that Trump's influence on the Fed will likely unfold gradually.

European stocks lost earlier gains on Wednesday afternoon following news of Donald Trump's victory over Kamala Harris in the U.S. presidential election. The Stoxx 600 dropped 0.68% by 4:00 p.m. London time, with all major bourses and most sectors in the red. Financial services rose 1.85%, while utilities led declines, falling 2.93%.

Bitcoin soared to a record high following Trump’s election victory, bolstered by his pro-cryptocurrency stance. Crypto-linked stocks like Coinbase, MicroStrategy, Riot Platforms, and MARA Holdings surged between 10% and 19.7% as investor optimism rose.

Shares of private prison operators Geo Group and CoreCivic surged around 28% following Trump’s victory, as investors anticipate that his promised crackdown on illegal immigration could increase demand for detention centers.

US steel makers Cleveland-Cliffs, Steel Dynamics, and Nucor saw shares jump between 10.4% and 16.4% following Trump’s election win. Analysts had anticipated that a Trump presidency would likely increase protections for the domestic steel industry, driving investor optimism.

Solar stocks sold off sharply following Donald Trump’s re-election. Key players like First Solar, Sunrun, and Sunnova saw significant losses, while inverter manufacturers Enphase and SolarEdge dropped 14% and 17%, respectively. The future of the Inflation Reduction Act (IRA), which supports clean energy, remains uncertain depending on the outcome of congressional control.

The Russell 2000 surged 4% following Trump’s election victory, as small-cap stocks, which are more domestically focused and cyclical, are expected to benefit from his proposed tax cuts and protectionist policies.

Mexican stocks plunged as much as 2.7% on Wednesday following Donald Trump’s election victory, marking the biggest intraday drop since June. The Mexbol index extended losses for a second day, while the MSCI Mexico Index fell 4.1% to its lowest level since October 2022. Stocks like Gentera and Grupo Aeroportuario underperformed amid concerns over potential negative impacts of a new Trump administration, including strained international relations and reduced traffic for Mexican airports.

Mexico's peso slumped to its weakest level in over two years following Donald Trump’s election victory, dropping as low as 20.8100 per dollar, more than 3% below the previous close. The decline marked the largest drop since Mexico’s summer election, continuing a trend of volatility for the emerging markets currency.

Bank shares gained momentum following Donald Trump’s election victory, with JPMorgan Chase, Bank of America, and Wells Fargo all rising by at least 6%. Investors expect the new administration's policies to benefit financial institutions.

Following Trump’s election, Nomura economists now expect only one Fed rate cut in 2025, down from an earlier forecast of four. They raised the terminal rate forecast by 50 basis points to 3.625%, anticipating Trump’s proposed tariffs will drive inflation up while slightly reducing growth. Nomura still predicts two 25-basis-point cuts this year but sees the Fed holding rates steady next year until tariff-related inflation eases.

Health insurer stocks surged after Trump’s re-election, with expectations of higher Medicare payments and relaxed regulations. UnitedHealth rose 6.6%, Humana 9%, and CVS Health 12%—its largest intraday gain in 24 years. Trump’s stance is seen as more industry-friendly, potentially favoring private Medicare plans and reversing Biden-era reimbursement cuts.

Amazon shares reached an intraday record Wednesday, rising 1% to $201.45, as investors continue favoring big tech. The stock has surged 32% this year, outpacing the Nasdaq 100’s 23% gain, driven by strong earnings and momentum in Amazon Web Services, particularly with AI advancements. Amazon also issued an optimistic holiday quarter forecast, fueling investor confidence.

Tesla shares jumped 13% following Trump’s election victory, as CEO Elon Musk, a vocal Trump supporter, is seen as well-positioned for favorable policies under the new administration.

Credit card stocks led S&P 500 gains in early trading, with Discover Financial soaring 22% and Capital One up 17%, according to Bloomberg.

The iShares China Large-Cap ETF (FXI) dropped over 2% in premarket trading following Donald Trump’s election win over Kamala Harris. The decline reflects renewed fears of higher U.S. tariffs on Chinese imports under Trump’s trade policies.

US stocks rallied Wednesday following Donald Trump’s election victory, with the Dow Jones up 1,300 points (3%)—its largest gain since 2022. The S&P 500 rose 2%, the Nasdaq 1.8%, and small-cap Russell 2000 surged 4% as investors favored companies likely to benefit from Trump’s policies. Tesla shares jumped 14%, and banks like JPMorgan, Bank of America, and Wells Fargo climbed over 6%. Bitcoin hit an all-time high of $75,000, while the dollar index reached its highest since July, and the 10-year Treasury yield spiked to 4.43% on inflation concerns. Trump Media & Technology Group surged 24%.

US stocks rallied Wednesday after Donald Trump’s election victory, with the Dow Jones soaring 1,300 points (3%) to a record high—its largest one-day jump since November 2022. The S&P 500 and Nasdaq also reached all-time highs, rising 2% and 1.8%, respectively.

Global markets were volatile and trading sideways, till clarity emerged on a Trump Presidency. This has led to a rally in the US market, Dow Futures are up over 2%. The Dollar index went up over 1%, leading to softness in gold prices. The rally in DYX has led to INR slipping to an all-time low of 84.25/$.

Positive for global markets, lower rates

A Trump Presidency will be largely positive for global markets, the key thing to watch out for will be interest rates in his tenure. Donald Trump has been very vocal about his stance on the need for lower rates, and its positive impact on the economy. Benchmark Indian indices are up over 1% amid multiple days of sell-off.

Gold in focus

Though gold fell in trade today, in the long term it is likely to trend upward as Trump's Presidency may lead to larger deficit and unpredictable foreign policies.

The dollar reached a one-year high following Trump’s election victory, with the Bloomberg Dollar Spot Index up 1.5% amid expectations of higher U.S. interest rates. The euro fell over 2% as parity loomed, while Treasury yields rose on anticipation of inflationary risks from Trump's fiscal policies. Analysts suggest potential further USD strength, with the Fed likely to cut rates by 25 basis points on Thursday.

Oil prices fell Wednesday after Donald Trump’s election win, with Brent down 1.34% to $74.52 per barrel and December contracts at $71. Trump’s pro-oil policies could boost US output, adding to global supply amid weak demand.

European stocks gained Wednesday after Donald Trump's win over Kamala Harris in the U.S. election. The Stoxx 600 rose 0.9% by midday in London, with most sectors up. Media stocks led gains, climbing 2.2%, while autos lagged, down 2.2%.

Indian equity market cheered Donald Trump's victory in the US presidential election and extended the winning streak for the second straight session on November 6, with Nifty rising above 24,500, amid buying across sectors especially in IT, realty, oil & gas and power names.

However, investors are also hoping for another rate cut by the Federal Reserve in its meeting scheduled on November 7. At close, the Sensex was up 901.50 points or 1.13 percent at 80,378.13, and the Nifty was up 270.75 points or 1.12 percent at 24,484.

Biggest gainers on the Nifty were Bharat Electronics, Adani Enterprises, TCS, Tech Mahindra and Infosys, while losers included SBI Life Insurance, Titan Company, IndusInd Bank, HDFC Life and HUL.

Donald Trump's second presidential win drove a broad G-10 currency sell-off, boosting the dollar. The Bloomberg Dollar Spot Index rose 1.6%—its largest gain since March 2020. The euro dropped 2.2% to a five-month low, GBP fell 1.4%, and USD/JPY surged to its highest since July. The Canadian dollar saw the smallest loss against the greenback.

US stocks closed sharply higher in a broad rally on Tuesday after data signaled a solid economy, but investors braced for volatile trading this week as voting was underway in an extremely tight U.S. presidential election.

The Institute for Supply Management said its non-manufacturing purchasing managers index, a gauge of the services sector, accelerated to 56.0 last month, its highest since August 2022, from 54.9 the prior month and above the 53.8 expected by economists polled by Reuters.

The S&P 500 gained 70.42 points, or 1.23%, to end at 5,783.11 points, while the Nasdaq Composite gained 259.19 points, or 1.43%, to 18,439.17. The Dow Jones Industrial Average rose 431.42 points, or 1.04%, to 42,227.74.