Trump Trades Catch a Bid in Afternoon Trading: Market Wrap

Equities, the dollar and Bitcoin all advanced in afternoon trading after a volatile morning for the stock market.

Big tech advanced with the Nasdaq 100 climbing 0.3% after dropping more than 1% earlier in the session. Traders were rattled as the fierce rally in Nvidia Corp. hit a speed bump following outlook that missed Wall Street’s high expectations. The war in Ukraine helped to cap the advance in equities while sparking a rally in oil and gold.

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Among notable movers Snowflake Inc. surged more than 30% while shares of MicroStrategy Inc., the largest publicly traded corporate holder of Bitcoin, sank on a short-seller report from Andrew Left’s Citron Research.

Ten-year US government bond yields steadied around 4.41% and the dollar rebounded after mixed labor data. Jobless claims came in lower than expected while continuing claims, a gauge of the number of people receiving benefits, rose to a three-year high.

Strategists at market research firm Fundstrat expect US stocks to climb into the US holiday week, followed by some weakening in December.

“The Nvidia earnings report leaves the likelihood of a Thanksgiving rally intact,” they wrote. “The AI trajectory has not changed all that much, but the market’s immediate reaction is less important than the fact that the uncertainty over Nvidia’s results is behind us.”

To Tom Essaye, founder of The Sevens Report, this week’s conflicting reports from Walmart Inc. and Target Corp. suggest some restraint from American consumers, who should be watched closely.

“The state of the labor market and consumer spending are indicative of a soft landing and that’s a good thing,” the former Merrill Lynch trader said. “But they are also vulnerable to deterioration from here and if that occurs, then a hard landing becomes substantially more likely and that would be a decided negative for stocks.”

Escalations in the Russia-Ukraine war gave oil and gold prices a boost, pusing WTI crude futures to around $70 a barrel. Ukraine reported that Russia fired an intercontinental ballistic missile during an overnight attack, while a Kremlin spokesman called Kyiv’s earlier use of UK Storm Shadow missiles a new escalation. 

“Geopolitics always has a potential of introducing volatility in the market and we have seen that with what is happening in Ukraine,” Themis Themistocleous, chief investment officer, EMEA at UBS Wealth Management told Bloomberg Television. “We have been advising clients to include oil into their portfolio, or derivatives of oil, to be able to hedge against potential volatility related to geopolitics.”

In Washington, some of the anxiety over President-elect Donald Trump’s pick for the top post at the US Treasury may be easing as the field of candidates narrows. 

“The contest for the Treasury Secretary appears to have come down to Bessent, Rowan, and Warsh – all of whom fall into the category of qualified adults in the room,” according to BMO’s Ian Lyngen. Though, “clarity is always preferable from the market’s perspective.”

Bitcoin topped $98,000 for the first time on optimism Trump’s support for crypto heralds a boom for the industry. Trump’s transition team has begun to hold discussions over whether to create a White House post dedicated to digital-asset policy as the world’s largest economy pivots toward a looser regulatory environment. 

US prosecutors charged Gautam Adani, one of the world’s richest people, with participating in a scheme that involved promising to pay more than $250 million in bribes to Indian government officials to secure solar energy contracts. The company denied the US allegations.

Some of the main moves in markets: 

This story was produced with the assistance of Bloomberg Automation.

With assistance from Richard Henderson, Divya Patil, Margaryta Kirakosian, Allegra Catelli, John Viljoen and Alex Nicholson.

This article was generated from an automated news agency feed without modifications to text.