9 December Market Data: Inflation, Earnings & More
Monday 09 December 2024
Bitcoin Rally & US Futures Up Following Trump's Victory
A new all-time-high Bitcoin price is leading a rally in the cryptocurrency market on 6 November, hitting a new record high over $75,000 as traders react to Donald Trump returning as US President. Likewise the major US stock averages are rallying before the open.
So-called ‘Trump Trades’ (the markets and assets expected to benefit from a Trump Presidency) gathered momentum after Donald Trump was projected to win the key swing state of Pennsylvania, and gained further ground after the former president declared victory in the Election.
Pro-Crypto Policies Fuel Bitcoin’s Price Surge
The price of Bitcoin surged on Wednesday, with crypto traders buying in as it became clear Donald Trump would return to the White House.
Bitcoin is up by more than 90% in 12 months.
The price has seemingly broken out of a bull flag pattern formed after hitting a new record high earlier this year. There has been considerable resistance to further gains for BTC around the $65,000-70,000 zone. Technical analysts view a breakout above resistance as an indicator of further gains ahead, but there is always the chance of a false breakout. (Source: U.Today)
Source: Plus500 platform
On the campaign trail, Trump made a number of key promises to support Bitcoin and the broader cryptocurrency industry, the most important of which are:
Bitcoin Strategic Reserve
Simplified Crypto Taxation
Support for US Bitcoin Miners
Stance Against CBDCs
Ross Ulbricht Pardon
Wall Street Optimism Grows as Trump Wins Swing States
Major US stock index futures surged on 6 November, adding to gains already made on election day, 5 November.
Dow futures (YM) jumped over 1,000 points as Trump declared victory at his headquarters in Florida, thanking supporters and promising to ‘turn around’ the country. "We're going to pay you back. We are going to do the best job. We're going to turn it around. It's got to be turned around, and it's got to be turned around fast. And we're going to turn it around" Trump said.
Alongside stock markets, the dollar index surged by 1.5%, its largest single-day gain since the start of the pandemic in March 2020. The euro showed particular weakness as factors like rising US tariffs and potential interest rate hikes weighed on the Eurozone’s economic outlook.
Trump Media (DJT) Explodes Higher
Perhaps unsurprisingly, one of the biggest one-day gainers on the back of Trump’s victory was the stock with the ticker bearing his initials DJT
Trump Media & Technology Group (DJT) stock soared 50% in pre-market trading as the former president declared himself the 47th President of the United States.
DJT is arguably the meme stock dujour and has seen substantial volatility in the lead up to the US election.
Conclusion: What’s Next under Trump’s Presidency?
Trump's proposals to lower corporate taxes, ease fiscal restrictions, and roll back regulations are anticipated to enhance market liquidity and potentially fuel further growth in the stock market.
However, these measures also raise concerns about accelerating inflation, expanding government debt, and a widening trade deficit. Such conditions could prompt the Federal Reserve to increase interest rates, which might dampen stock market performance.
And of course, politicians often don’t deliver on their promises, so ultimately the result of a Donald Trump presidency is unknown - and some of the short-term gains could simply be the result of reduced uncertainty.
