Trump electoral advantage, strong bank reports, and BTC surges

MOTIVATION
QUOTE OF THE WEEK

"Success is not final, failure is not fatal: It is the courage to continue that counts."
— Winston Churchill

WEEK 14/10/2024 to 18/10/2024
🚨What you need to know this week🚨

• Trump holds a lead in the elections: The markets are increasingly betting on a Trump victory, which has led to market optimism and anticipation.

• Chinese equities see massive inflows: Nearly $40B has flowed into Chinese stocks, while Japan experienced its largest outflows in 20 years.

• Fast Retailing Co., Ltd. (FRCOY) reports record earnings: The company has shown strong global market growth, surprising analysts.

• Russia proposes alternative payment systems for BRICS: Russia is making waves with a proposal to bypass the dominance of the U.S. dollar within the BRICS economies.

• Fed’s Waller signals less aggressive rate cuts ahead: Waller stated that future rate cuts will likely be more moderate.

• NVIDIA’s Market Cap is nearing Apple’s: NVIDIA continues to rise, but its valuation remains volatile despite nearing Apple's market cap.

• Big banks report strong earnings: Goldman Sachs, Bank of America, and Citigroup all posted solid quarterly results, adding to market bullishness.

• S&P 500 rallies: The S&P 500 has surged nearly 4% since the September 18 rate cut announcement.

• Retail sales exceed expectations: U.S. retail sales continue to be strong, outperforming analyst predictions and supporting market strength.

• AI investments keep rising: With tech companies doubling down on AI, investments in the sector show no signs of slowing.

• ECB cuts rates again: The European Central Bank has cut rates for the third time this year, now sitting at 3.25%.

• NVIDIA’s impressive YTD performance: NVIDIA has soared over 180% year-to-date, solidifying its dominance in the AI and semiconductor space.

• PONY AI files for U.S. IPO: Chinese robotaxi company PONY AI is set to go public in the U.S. after filing for an IPO on Thursday.

• Chinese GDP outperforms: China’s Q3 GDP grew by 4.6% YoY, beating expectations of 4.5%.

• Netflix stock rises: Netflix shares surged following an impressive quarterly report showing 15% YoY revenue growth and 44.7% YoY EPS growth.

18/10/2024
🔎 Insights on the market 🔎

Bullish week, but not with overwhelming strength—still bullish nonetheless. The SPY continues hitting new highs, but with some hesitation. Thursday opened with an upward gap that was closed the same day, and today, Friday, we see a green candle, but it stayed within the range of the previous candle. In other words, it didn't make a new high, so I would exercise some caution.

Bitcoin, on the other hand, is starting to show signs of breaking out of the bearish channel it has been in since March. It needs volume to come in to finally break out, as there are several resistance levels in the way. We talk about this daily on my X profile—check out the link below to stay updated with these daily analyses.

📜 Historical Perspective 📜

• China’s GDP growth: Historically, China’s economic growth outpacing expectations has often led to increased investor interest in emerging markets.

• Market reactions to presidential elections: Historically, markets tend to rally when there is perceived certainty in the outcome of U.S. elections, especially when candidates with pro-business stances hold an advantage.

18/10/2024
✍️Market Lessons ✍️

This week highlights how quickly sentiment can shift on geopolitical and economic news, from Trump’s electoral lead to strong earnings in banks and tech stocks. Markets can rally on expectations but remain cautious as future rate cuts seem less aggressive than anticipated.

💸 Common Mistakes 💸

Investors should not be too quick to jump on the bandwagon when markets seem over-enthusiastic. While Trump’s potential victory has bolstered confidence, it’s important to weigh the long-term implications of fiscal and geopolitical decisions.

📅Next Week’s Economic Calendar (21/10 to 25/10):📅

Monday, October 21, 2024

Tuesday, October 22, 2024

Wednesday, October 23, 2024

Thursday, October 24, 2024

Friday, October 25, 2024

📅EARNINGS CALENDAR (14/10-18/10/2024)📅

Friday, October 18, 2024