"Trump 2.0 market" starts! A special feature on "stocks that cry and stocks that laugh"! Which ones will benefit the most from tax cuts and deregulation?
「トランプ2.0相場」が始動した。トランプ氏が米大統領選に勝利した11月6日、米国市場はリスクオンとなった。トランプ氏公約の減税・規制緩和・関税政策が米国の経済成長と企業利益を押し上げると期待され、株高・ドル高が進んだ。政権発足は来年1月で、公約の実行度合いはチェックしていく必要があるが、今のところ政策期待は続きそうだ。
After checking the situation on the first day of the 'Trump 2.0 market,'taking into account President Trump's policy pledges,picked out the 'stocks to cry for and those to laugh at,'chosen.
Incorporating President Trump's promises of tax cuts, deregulation, tariffs, and immigration policies,
⇒Trump's policies have the potential to stimulate economic growth, corporate profits, and inflation simultaneously.
●Stocks are up
Tax cuts lead to economic growth and increased corporate profits
◇Dow Inc: Increased by 3.6%
◇S&P500Up by 2.5%:
◇Nasdaq 100Up by 2.7%:
◇Russell 2000Up by 5.8%:
●Rising interest rates and a stronger dollar.
Tax cuts lead to economic growth, increased fiscal deficits, while tariff hikes lead to inflationary pressure.
◇10-year government bond yields: Sharp rise from the 4.2% range to the 4.4% range.
◇dollars：The largest increase since 2020, the dollar index has risen by 1.3%.
◇Commodities: Due to the high dollar, crude oil, copper, gold, etc., have declined.
●Bitcoin at its peak
Mr. Trump promises to make the USA the world's leading Bitcoin country by adopting cryptocurrencies during his election campaign.
Tax cuts lead to economic growth and increased corporate profits
◇Dow Inc: Increased by 3.6%
◇S&P500Up by 2.5%:
◇Nasdaq 100Up by 2.7%:
◇Russell 2000Up by 5.8%:
●Rising interest rates and a stronger dollar.
Tax cuts lead to economic growth, increased fiscal deficits, while tariff hikes lead to inflationary pressure.
◇10-year government bond yields: Sharp rise from the 4.2% range to the 4.4% range.
◇dollars：The largest increase since 2020, the dollar index has risen by 1.3%.
◇Commodities: Due to the high dollar, crude oil, copper, gold, etc., have declined.
●Bitcoin at its peak
Mr. Trump promises to make the USA the world's leading Bitcoin country by adopting cryptocurrencies during his election campaign.
The characteristics of Mr. Trump's economic policies are boosting the economy through tax cuts for corporations and individuals and prioritizing national interests such as raising tariffs. Therefore, it is positive for the overall US economy and US stocks in general, but there is a possibility that cyclical stocks could benefit even more.
Financial stocks
Financial services can benefit from economic growth driven by tax cuts and prioritization of national interests, as well as the possibility of deregulation regarding capital controls and M&A acting as a tailwind. The uncertainties regarding the impact of interest rate trends on performance may be offset by deregulation, among other factors. It should be noted that in the latest earnings reports, many US banks achieved interest income exceeding market expectations despite interest rate cuts.
Related stocks
☆ $Goldman Sachs (GS.US)$
☆ $JPMorgan (JPM.US)$
☆ $Vanguard Financials ETF (VFH.US)$
Financial services can benefit from economic growth driven by tax cuts and prioritization of national interests, as well as the possibility of deregulation regarding capital controls and M&A acting as a tailwind. The uncertainties regarding the impact of interest rate trends on performance may be offset by deregulation, among other factors. It should be noted that in the latest earnings reports, many US banks achieved interest income exceeding market expectations despite interest rate cuts.
Related stocks
☆ $Goldman Sachs (GS.US)$
☆ $JPMorgan (JPM.US)$
☆ $Vanguard Financials ETF (VFH.US)$
● Railroad and infrastructure-related stocks
It is expected that President Trump's economic stimulus measures and policies that focus on boosting the domestic economy will greatly benefit railroad and infrastructure-related stocks, which are sensitive to the domestic economy.
Related stocks
☆ $CSX Corp (CSX.US)$
☆ $Union Pacific (UNP.US)$
☆ $Norfolk Southern (NSC.US)$
☆ $CRH PLC (CRH.US)$
☆ $Vulcan Materials (VMC.US)$
It is expected that President Trump's economic stimulus measures and policies that focus on boosting the domestic economy will greatly benefit railroad and infrastructure-related stocks, which are sensitive to the domestic economy.
Related stocks
☆ $CSX Corp (CSX.US)$
☆ $Union Pacific (UNP.US)$
☆ $Norfolk Southern (NSC.US)$
☆ $CRH PLC (CRH.US)$
☆ $Vulcan Materials (VMC.US)$
- Aviation and Leisure related stocks
If the economic outlook becomes brighter due to measures like President Trump's tax cuts, it could potentially stimulate individual leisure consumption. This could be a positive factor for airline and leisure related stocks.
Related stocks
☆ $Delta Air Lines (DAL.US)$
☆ $United Airlines (UAL.US)$
☆ $Carnival (CCL.US)$
☆ $Booking Holdings (BKNG.US)$
If the economic outlook becomes brighter due to measures like President Trump's tax cuts, it could potentially stimulate individual leisure consumption. This could be a positive factor for airline and leisure related stocks.
Related stocks
☆ $Delta Air Lines (DAL.US)$
☆ $United Airlines (UAL.US)$
☆ $Carnival (CCL.US)$
☆ $Booking Holdings (BKNG.US)$
- Defense-related stocks
President Trump's tough foreign policy could increase geopolitical risks. During the "Trump 1.0 administration", the budget proposal included a 10% increase in defense spending, which could benefit defense-related stocks.
Related stocks
☆ $Lockheed Martin (LMT.US)$
☆ $Howmet Aerospace (HWM.US)$
President Trump's tough foreign policy could increase geopolitical risks. During the "Trump 1.0 administration", the budget proposal included a 10% increase in defense spending, which could benefit defense-related stocks.
Related stocks
☆ $Lockheed Martin (LMT.US)$
☆ $Howmet Aerospace (HWM.US)$
● top pick for australian small/mid cap
Australian small/mid cap stocks may benefit more from Trump's focus on the domestic economy. Compared to large-cap stocks with many global companies, small/mid cap stocks tend to have a lower overseas exposure and higher correlation with domestic economic trends. Considering the high valuation of large-cap stocks, the Russell 2000 index is still trading at a historical average level, suggesting that there may still be room for growth in small/mid caps. However, if interest rates continue to rise, small/mid cap stocks with high debt ratios may be more vulnerable than large-cap stocks. It is important to monitor interest rate trends.
Related Stocks
☆ $First Trust Smid Cap Rising Dividend Achievers Etf (SDVY.US)$
☆ $Wisdomtree U.S. Smallcap Quality Dividend Growth ETF (DGRS.US)$
☆ $Wisdomtree Trust Smallcap Dividend Fund (DES.US)$
☆ $WisdomTree US MidCap Dividend ETF (DON.US)$
Australian small/mid cap stocks may benefit more from Trump's focus on the domestic economy. Compared to large-cap stocks with many global companies, small/mid cap stocks tend to have a lower overseas exposure and higher correlation with domestic economic trends. Considering the high valuation of large-cap stocks, the Russell 2000 index is still trading at a historical average level, suggesting that there may still be room for growth in small/mid caps. However, if interest rates continue to rise, small/mid cap stocks with high debt ratios may be more vulnerable than large-cap stocks. It is important to monitor interest rate trends.
Related Stocks
☆ $First Trust Smid Cap Rising Dividend Achievers Etf (SDVY.US)$
☆ $Wisdomtree U.S. Smallcap Quality Dividend Growth ETF (DGRS.US)$
☆ $Wisdomtree Trust Smallcap Dividend Fund (DES.US)$
☆ $WisdomTree US MidCap Dividend ETF (DON.US)$
● Major US tech stocks 'M7'
・During the 'Trump 1.0 administration', there seemed to be inconsistency in views and policies regarding the high-tech sector, such as criticizing major tech companies. However, it is natural that major US tech stocks will benefit from Trump's tax reduction measures.
・In addition, during the current election campaign, Trump has stated that he will reverse many of the policies of the Biden administration. Regarding the strict enforcement policy of antitrust laws and the strengthening of AI regulations by the Biden administration, Trump may have the potential to relax them.
・Considering factors such as innovation strength and high profit margins, it is believed that major US tech stocks may achieve performance surpassing the market even in the 'Trump 2.0 market'.
Related stocks
☆ $Invesco QQQ Trust (QQQ.US)$
☆ $Tesla (TSLA.US)$
☆ $NVIDIA (NVDA.US)$
☆ $Alphabet-A (GOOGL.US)$
☆ $Amazon (AMZN.US)$
☆ $Microsoft (MSFT.US)$
☆ $Meta Platforms (META.US)$
☆ $Apple (AAPL.US)$
・During the 'Trump 1.0 administration', there seemed to be inconsistency in views and policies regarding the high-tech sector, such as criticizing major tech companies. However, it is natural that major US tech stocks will benefit from Trump's tax reduction measures.
・In addition, during the current election campaign, Trump has stated that he will reverse many of the policies of the Biden administration. Regarding the strict enforcement policy of antitrust laws and the strengthening of AI regulations by the Biden administration, Trump may have the potential to relax them.
・Considering factors such as innovation strength and high profit margins, it is believed that major US tech stocks may achieve performance surpassing the market even in the 'Trump 2.0 market'.
Related stocks
☆ $Invesco QQQ Trust (QQQ.US)$
☆ $Tesla (TSLA.US)$
☆ $NVIDIA (NVDA.US)$
☆ $Alphabet-A (GOOGL.US)$
☆ $Amazon (AMZN.US)$
☆ $Microsoft (MSFT.US)$
☆ $Meta Platforms (META.US)$
☆ $Apple (AAPL.US)$
☆ Nvidia
・There is a possibility that President Trump may strengthen restrictions on semiconductor exports to China, which could be a significant factor for semiconductor stocks. However, despite the US having strengthened semiconductor export restrictions to China over the past few years, Nvidia has continued to deliver strong performance. This is because the China ratio has already significantly decreased, and Nvidia is benefiting more from the AI boom in the US.
・In the latest financial results, major US tech companies have indicated their intention to expand investment in AI, which is expected to continue to provide tailwinds for the company. If stock prices adjust due to Trump's strengthened export regulations to China, it may be a buying opportunity if the business environment surrounding AI semiconductors remains unchanged.
・In the latest financial results, major US tech companies have indicated their intention to expand investment in AI, which is expected to continue to provide tailwinds for the company. If stock prices adjust due to Trump's strengthened export regulations to China, it may be a buying opportunity if the business environment surrounding AI semiconductors remains unchanged.
(Regarding the outlook for AI, the CEO of a major AI software company $Palantir (PLTR.US)$ In the latest financial results, the CEO stated, "The world is currently in the midst of the US-led AI revolution, and industries and economies are being reconstructed." Related article:Parantia soars 23% with record profits! "We are at the forefront of the AI revolution."）
☆ Tesla
・Tesla has become the most prominent "Trump stock" this time around. Trump's victory is expected to bring many benefits to Elon Musk's SpaceX. SpaceX is estimated to have contracts with the US government worth over 15 billion dollars over the past decade.
・As for Tesla, Trump has campaigned for the abolition of EV sales promotion measures, which could have a negative impact. If the "Trump 2.0" administration eliminates EV subsidies, it is expected to be negative for the industry as a whole. However, Tesla, as the industry leader with economies of scale, may be less impacted compared to other EV manufacturers, potentially recovering the market share decline experienced in a subsidy-free competitive environment.
・Elon Musk, CEO known as a supporter of former President Trump, has made substantial contributions to Trump. Trump once said in August of this year, "I support EV. I have no choice, because Elon has supported me very strongly." It was reported by WSJ that "with Trump's victory Musk may also be involved in the regulation of self-driving cars, which will be key to Tesla's growth."
・As for Tesla, Trump has campaigned for the abolition of EV sales promotion measures, which could have a negative impact. If the "Trump 2.0" administration eliminates EV subsidies, it is expected to be negative for the industry as a whole. However, Tesla, as the industry leader with economies of scale, may be less impacted compared to other EV manufacturers, potentially recovering the market share decline experienced in a subsidy-free competitive environment.
・Elon Musk, CEO known as a supporter of former President Trump, has made substantial contributions to Trump. Trump once said in August of this year, "I support EV. I have no choice, because Elon has supported me very strongly." It was reported by WSJ that "with Trump's victory Musk may also be involved in the regulation of self-driving cars, which will be key to Tesla's growth."
● Bitcoin-related stocks
「Bitcoin surpasses $76,000! All-time high updated. With the return of the Trump administration, there is a tailwind blowing in the cryptocurrency industry!Please refer to the article.
「Bitcoin surpasses $76,000! All-time high updated. With the return of the Trump administration, there is a tailwind blowing in the cryptocurrency industry!Please refer to the article.
● Renewable energy-related stocks
・Former President Trump denies that climate change is the result of burning fossil fuels. During the election period, he criticized the Democratic Party's climate change measures as a 'new green scam'. Therefore, it is expected that the current Biden administration's green policies will be overturned. This could be a significant factor for renewable energy-related stocks.
・In addition, renewable energy-related electric power stocks have continued to rise in value due to the rapid expansion of demand associated with the construction boom of AI data centers. In anticipation of a victory by Trump, profit-taking sales are ongoing, and the uncertainty surrounding green policies may remain a significant factor for some time. On the other hand, there is a possibility of continued AI demand in the future, and there may be investment opportunities to watch closely as policy directions unfold.
Related stocks
☆ $NextEra Energy (NEE.US)$
☆ $The AES Corp (AES.US)$
・Former President Trump denies that climate change is the result of burning fossil fuels. During the election period, he criticized the Democratic Party's climate change measures as a 'new green scam'. Therefore, it is expected that the current Biden administration's green policies will be overturned. This could be a significant factor for renewable energy-related stocks.
・In addition, renewable energy-related electric power stocks have continued to rise in value due to the rapid expansion of demand associated with the construction boom of AI data centers. In anticipation of a victory by Trump, profit-taking sales are ongoing, and the uncertainty surrounding green policies may remain a significant factor for some time. On the other hand, there is a possibility of continued AI demand in the future, and there may be investment opportunities to watch closely as policy directions unfold.
Related stocks
☆ $NextEra Energy (NEE.US)$
☆ $The AES Corp (AES.US)$
● A-reit ETF
While Trump's policies could potentially boost the economy, they may also increase the fiscal deficit, leading to a possible rise in interest rates. Consequently, it is expected that mortgage interest rates will also increase, becoming a significant factor for a-reit etf. However, there are also expectations for enhanced tax incentives for residential construction companies, so the impact on a-reit etf due to mixed material strengths and weaknesses needs to be carefully assessed in the future.
While Trump's policies could potentially boost the economy, they may also increase the fiscal deficit, leading to a possible rise in interest rates. Consequently, it is expected that mortgage interest rates will also increase, becoming a significant factor for a-reit etf. However, there are also expectations for enhanced tax incentives for residential construction companies, so the impact on a-reit etf due to mixed material strengths and weaknesses needs to be carefully assessed in the future.
・Due to the "Trump trend" continuing for over a month until the election, there is a possibility of profit-taking sell-offs at some point.
・If the rise in government bond yields continues, there is a possibility of restraining the rise in the stock market.
・In comparison to the "Trump 1.0" administration, the "Trump 2.0" administration may have a wider range and higher tariff rates. Tax reductions may become more focused.
・President Trump's policies could fuel inflation and potentially slow down the pace of the Federal Reserve's rate cuts. It's worth noting that the Federal Reserve decided to cut rates by 0.25% on November 7th. Chairman Powell mentioned that the pace of future rate cuts will depend on the data, and did not hint at stopping the rate cuts.
Regarding the market trend after the U.S. presidential election, based on past experiences, "the first year of a president's term tends to go well, with most showing a double-digit increase.""
"The following periods will be significant to watch: "The presidential inauguration on January 20 next year, where President Trump's inaugural speech and a series of presidential orders may be issued from late January to early February, presenting a crucial period to assess the direction of the Trump administration."
Related articles:After his comeback, what points should we pay attention to regarding former President Trump's reign as USA president? Will the rise in US stocks continue until next year?
Related articles:After his comeback, what points should we pay attention to regarding former President Trump's reign as USA president? Will the rise in US stocks continue until next year?
Created on November 8, 2024 by Market Analyst Julie
Source: Created by moomoo Securities based on Bloomberg and various sources
Source: Created by moomoo Securities based on Bloomberg and various sources
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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