Stock Market Today: Major Indexes Hit Record Highs as Post-Election Rally Continues
Market Overview: November 12, 2024
The stock market continued its impressive post-election rally on Tuesday, November 12, 2024, with major indexes reaching new all-time highs. Investors remain bullish as they anticipate the impact of President-elect Donald Trump’s policies on the U.S. economy. The S&P 500, Nasdaq Composite, and Dow Jones Industrial Average all closed at record levels, reflecting the market’s optimism.
Why Is the Market Up Today?
Several factors are contributing to the current market uptrend:
1. Post-election optimism: Investors are betting on Trump’s protectionist policies benefiting U.S. industries, especially the manufacturing sector.
2. Interest rate cuts: The Federal Reserve’s recent rate cuts have boosted confidence in risky assets like equities. The current fed funds rate stands at 4.50-4.75%, down from a 23-year high of 5.25-5.5% in mid-September.
3. Strong economic fundamentals: The U.S. GDP grew at 1.6%, 3%, and 2.8% in the first three quarters of 2024, respectively, with estimates of 2.5% growth for the fourth quarter.
4. Positive earnings reports: As of November 8, 73.5% of S&P 500 companies have beaten earnings per share (EPS) estimates, with total earnings up 7.1% year over year.
Current Market Performance
As of the market close on November 12, 2024:
– Dow Jones Industrial Average (^DJI): Rose 0.7% to close at 44,293.13, marking its first close above 44,000.
– S&P 500 (^GSPC): Gained 0.1% to finish at 6,001.35, closing above 6,000 for the first time.
– Nasdaq Composite (^IXIC): Finished at a record high of 19,298.76, rising 0.1%.
Major Stock News
1. Tesla (TSLA): After surging 9% on Monday, Tesla’s stock saw a slight pullback of 2% in early trading on Tuesday. The electric vehicle maker has gained over 40% in the past week.
2. Honeywell (HON): Shares jumped more than 5% following reports of activist investor Elliott Investment Management taking a $5 billion stake in the company.
3. Home Depot (HD): The retailer’s shares rose about 1% after reporting better-than-expected quarterly results and boosting sales projections.
4. Shopify (SHOP): The e-commerce platform’s stock soared more than 20% after a strong earnings report.
Upcoming Market Events
Investors should keep an eye on these potential market movers:
1. Further interest rate decisions: The CME FedWatch tool indicates a 70% probability of another 25 basis-point rate cut in December.
2. Ongoing earnings season: With 452 S&P 500 companies having reported so far, the remaining reports could impact market sentiment.
3. Economic data releases: Upcoming reports on inflation, employment, and GDP growth will be closely watched for signs of economic health.
Cryptocurrency and Related Stocks
The cryptocurrency market is also experiencing significant gains:
– Bitcoin (BTC-USD): Reached a new all-time high near $90,000 before settling around $86,000.
– Coinbase (COIN): The cryptocurrency exchange’s stock has surged over 70% in the past five days.
Market Outlook
While the market rally has been impressive, some analysts caution that stocks may be overbought in the short term. Bank of America reports that investor exposure to U.S. stocks is at an 11-year high, which could set the stage for profit-taking.
As the market digests President-elect Trump’s cabinet picks and potential policy directions, volatility may increase. Investors should remain vigilant and consider the potential impacts of upcoming economic data and policy decisions on their portfolios.
In conclusion, the stock market today reflects a strong bullish sentiment, driven by post-election optimism and favorable economic conditions. However, as with any market rally, investors should remain cautious and stay informed about potential risks and opportunities in this dynamic economic environment.
