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  • 📈 The Trump Trade Is So Back

📈 The Trump Trade Is So Back

+ Prediction Markets Are Having Their Moment

November 06, 2024

Good afternoon! Watch the skies, Phoenix—Amazon’s drones are on delivery duty. Select customers can now have 50,000 lightweight items (we’re talking tech gadgets, beauty products, and more) dropped at their doorstep within an hour. Amazon’s MK30 drone is the star of the show, boasting FAA approval to fly beyond line of sight and engineered to be 50% quieter. No late-night snack runs, though—deliveries are limited to daylight and nice weather.

The new MK30 model also has a rainproof upgrade, letting Amazon push forward in its quest to master the skies. Currently, Phoenix and College Station, Texas, get the drone treatment, with global rollouts hinted but still on hold. Until then, Phoenix residents can enjoy their futuristic deliveries while the rest of us wait for our skies to fill with Amazon’s airborne couriers.

MARKETS

*Stock data as of market close*

  • Stocks were on fire Wednesday as Donald Trump’s victory spurred a massive market rally. The Dow skyrocketed more than 1,500 points in a single session, making it its best day since 2022, while the S&P 500 charged up 2.53% to top 5,929. Not to be outdone, the Nasdaq added nearly 3%, with all three indexes ending the day at record highs.

  • But stocks weren’t the only thing moving. The dollar got a boost, and Treasury prices took a hit as investors doubled down on a potential Trump-led economic overhaul. From tariffs to taxes, Wall Street was all in on policies they expect to reshape the economic landscape, sending waves through stocks, bonds, and currencies alike.

STOCKS
Winners & Losers

What’s up 📈

  • Coinbase surged 31.11% on speculation that a Trump presidency would foster a more favorable regulatory environment for cryptocurrency. ($COIN)

  • Discover Financial Services gained 20.22% as investors anticipated looser regulations under a Trump administration, potentially paving the way for more mergers and acquisitions in the banking sector. ($DFS)

  • CVS Health soared 11.33% after surpassing Q3 revenue expectations with $95.43 billion, above the $92.75 billion forecast, though its adjusted earnings of $1.09 per share missed estimates of $1.51 per share. ($CVS)

  • Planet Fitness increased 6.12% after reports surfaced that it is interested in acquiring the bankrupt budget-fitness chain Blink Holdings. ($PLNT)

  • Alphabet (Google) rose 3.99% on expectations that a Trump presidency could reduce regulatory pressures on Big Tech, potentially easing antitrust scrutiny. ($GOOGL)

  • Amazon gained 3.80% for similar reasons, as a Trump return to the White House could lead to a lighter regulatory stance on tech giants. ($AMZN)

  • Robinhood rose 19.63%. ($HOOD)

  • Palantir climbed 8.61%. ($PLTR)

What’s down 📉

  • Super Micro Computer plunged 18.05% after issuing Q4 revenue guidance between $5.5 billion and $6.1 billion, below analysts’ expectations. The company’s adjusted EPS outlook also missed forecasts, and it remains uncertain when it will file its annual results, though it is working to resolve reporting delays. ($SMCI)

  • Enphase Energy dropped 16.82% as clean energy stocks broadly declined amid speculation that a Trump presidency could lead to a rollback of industry reforms, potentially including the repeal of the Inflation Reduction Act. ($ENPH)

  • Philip Morris declined 5.20% despite a potentially favorable outlook for tobacco stocks under a Trump administration, with the possibility of reversing Biden’s proposed menthol cigarette ban. ($PM)

  • Nike slipped 3.41% on concerns that Trump’s proposed tariffs could increase footwear costs, impacting companies like Nike and Walmart. ($NKE)

  • Rivian fell 8.31%. ($RIVN)

  • Mattel declined 6.98%. ($MAT)

  • Zillow slid 6.56%. ($Z)

ELECTION
The Trump Trade Is So Back

With the confetti barely settled, Wall Street is jumping on the "Trump Trade" bandwagon, cheering on the promise of tax cuts, deregulation, and a whole lot of American-made everything.

After Trump’s decisive win, investors seem ready to party like it’s 2017 all over again, driving stocks higher in celebration.

Stocks Soaring, Banks Roaring

In true Trump style, the biggest winners were unsurprising: Trump Media & Technology Group ticked up 6%, and Tesla shot up a whopping 15% as Elon Musk fans speculated his next role could come with a White House Cabinet badge. B

anks were also in for a big day with JPMorgan and Wells Fargo seeing double-digit gains—investors banking on lighter regulations are here for the ride.

Crypto fans are grinning ear-to-ear as Bitcoin hit a new high at $76,000, with Ethereum and Coinbase riding the wave of Trump’s pledge to make the U.S. the “crypto capital of the planet.” And oil’s back in play, with fossil-fuel giants like Exxon enjoying a lighter-touch regulatory future.

Clean Energy, Not So Much: Not every sector is feeling the love. Green energy stocks like First Solar and Enphase Energy took a beating, down 10% and more, with the Invesco Solar ETF trailing alongside. Investors are worried Trump’s clean energy cuts could halt momentum for solar and wind.

Bonds, the Dollar, and All That Jazz: Treasury yields popped as bondholders braced for a more inflationary, debt-ridden policy path. And the dollar? It’s on a tear, seeing its biggest gain since 2020 as a higher tariff policy puts a chill on imports, boosting the greenback.

The Bottom Line: While Wall Street’s in a post-election high, the experts are wary. Veteran investor Leon Cooperman warned that traders might be “too optimistic,” and some analysts say it could be short-lived. For now, the “Trump Trade” seems full steam ahead, but as always in markets, it’s best to keep one hand on the exit.

NEWS
Market Movements

MARKETS
Prediction Markets Are Having Their Moment

Betting markets took a big W this week, as former President Donald Trump’s election win confirmed what sites like Kalshi and Polymarket have been shouting for weeks: the odds were in Trump’s favor, despite what the polls claimed. With bets pouring in as high as 70% for Trump on some platforms, it seems political markets may just be stealing the predictive spotlight.

Prediction markets are officially having a moment. Platforms like Kalshi, Polymarket, and even Robinhood are diving into event-based trading, allowing users to bet on anything from presidential outcomes to rainfall odds.

For Wall Street pros and everyday bettors alike, these markets offer a new way to speculate—and maybe even profit—on real-world events. The appeal? While traditional investments hinge on long-term trends, event-based trading lets users cash in on predictions in real-time, giving them a front-row seat to high-stakes, headline-driven market moves.

Trump Odds Surge, Betting Markets Get Serious

The betting markets were on fire leading up to the election, with millions poured into wagers across various platforms. Kalshi, the only legal site for U.S. election betting, saw over $250 million in wagers, but Polymarket, the grey-market crypto platform, took it to the next level with over $3 billion in bets.

Robinhood even joined the game, rolling out election contracts a week before the final votes were counted. Clearly, everyone’s trying to cash in on this new political betting boom.

The Winners, Losers, and Future of Election Betting

On the winning side? Tesla, Bitcoin, and Trump Media all enjoyed post-election bumps. But this newfound love for political markets has the Commodity Futures Trading Commission (CFTC) eyeing tougher regulations. They’re worried that this craze for betting on real-world events could be too risky for the average trader.

So, for now, betting markets are riding high, basking in the glow of their big election night win. Whether they’ll continue this streak without regulation raining on their parade? Only time (and a lot of bets) will tell.

Calendar
On The Horizon

Tomorrow

Tomorrow’s lineup starts with initial jobless claims—aka, the latest pulse check on how many folks are filing for unemployment. It’s a big deal for the Fed’s next rate move, though by the time these numbers hit, Jerome Powell and the crew will be locked in on their decision.

So, what’s the verdict? Analysts are betting hard on a 0.25% rate cut, and markets seem to agree, pricing in the odds of a trim at a cool 99.6%. It’s a smaller dip than the one in September, but that’s the Fed keeping things steady. The labor market’s been flexing some strength lately, so no need for the summer’s panic-fueled, jumbo-sized cuts.

But don’t get too hung up on the rate cut itself. Eyes should be on Powell’s press conference later in the day. The man’s words and the Fed’s follow-up chatter could tell us a whole lot more about their game plan for the months ahead.

Before Market Open:

  • Planet Fitness banks on members who sign up, then conveniently forget to show up. But the FTC’s new “Click-to-Cancel” rule could make those “set-it-and-forget-it” memberships harder to hold onto. The rule, aimed at simplifying cancellations, is still under legal review, so the company’s stock hasn’t taken a hit just yet. But if this rule sticks, Planet Fitness might need a new game plan to keep revenue pumping. Analysts forecast $0.58 EPS and $285.87 million in revenue. ($PLNT)

After Market Close:

  • Pinterest has been on a wild ride lately—a strong spring, followed by a tough summer slump thanks to lackluster guidance that sent shares tumbling. But now, with the stock looking relatively cheap, investors are tuning in to see if AI can be the growth engine Pinterest needs. All eyes are on management’s plans for AI-powered user engagement and revenue growth. Wall Street expects $0.34 EPS and revenue of $896.31 million. ($PINS)

NEWS
The Daily Rundown

  • 🏛️ GOP Secures Senate Control, House Too Close to Call: Alongside Trump’s success, Republicans regained control of the Senate, flipping Democratic seats in Ohio and West Virginia. The House remains undecided, with numerous close races still counting votes this morning, as Democrats hope to reclaim a slim GOP-controlled chamber.

  • 📝 Other Notable Election Results: Florida voters rejected a measure to legalize recreational marijuana, supported by Gov. Ron DeSantis and billionaire Ken Griffin. Abortion rights were on the ballot in ten states, with six passing protective measures and Florida, South Dakota, and Nebraska projected to fail. California voters approved harsher penalties for shoplifting, rolling back some criminal justice reforms.

  • 🇮🇱 Netanyahu Dismisses Defense Minister Amid Crisis: Israeli Prime Minister Benjamin Netanyahu removed Defense Minister Yoav Gallant, citing a “crisis of trust.” Gallant, who oversaw Israel's efforts in Gaza, had previously voiced support for diplomatic solutions regarding Hamas and urged a temporary hostage deal. His dismissal follows political friction and recent conscription of ultra-Orthodox men, sparking protests across Israel.

  • 📉 Nintendo’s Profit Drops as Switch Sales Slow: Nintendo’s profit fell 69% in the first half of the fiscal year, leading the company to revise its Switch sales forecast down to 12.5 million units. Despite remaining Nintendo’s second-best-selling console, competition from the PS5 and Xbox Series X/S has impacted demand. Nintendo plans to release a new model by March 2025 to reignite interest

  • 🍕 Yum Brands Misses Revenue Estimates: Yum Brands, parent of Taco Bell and Pizza Hut, reported lower-than-expected revenues, as consumer demand lagged across some locations, especially combination Pizza Hut-Taco Bell stores.

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