Happy Veterans Day! Stocks are looking to add to last week’s big gains this morning, while bonds aren’t trading due to the holiday. Gold and silver are pulling back along with crude oil, in part because the dollar is jumping again.
Meanwhile, cryptocurrencies are a HUGE story in markets. Bitcoin was recently trading at a fresh record high above $82,000. Several other cryptocurrencies are also on the march, propelled by optimism that a Trump Administration will be much more friendly to the industry than the Biden Administration has been.
Trump is expected to regulate crypto trading firms and crypto products less strictly than traditional banks, stocks, and bonds. He may also create a national Bitcoin reserve (similar to what the US does with oil).
Bitcoin
Meanwhile, Elon Musk’s close ties to Trump are benefitting shareholders of Tesla Inc. (TSLA) tremendously. The stock is surging again after a strong post-election rally last week, topping $1 trillion in market capitalization. Investors are speculating that Tesla’s products, including its self-driving car technology, could be treated more favorably by the new administration.
Finally, financial stocks are on fire amid expectations for less regulation, greater profit potential, tax reform, and lower loan losses moving forward. Hedge funds are plowing money into financial stocks at a rate not seen in three years, according to Goldman Sachs Group Inc. (GS) research. The SPDR S&P Regional Banking ETF (KRE) is up almost 12% in the last five trading days, while the Financial Select Sector SPDR (XLF) is up more than 6%.
