In Markets "In a Nutshell"

Markets “In a Nutshell” for November 18, 2024

Investment Week at a Glance

Stocks finished lower for the week. The Dow Jones Industrial Average fell 1.2%, the S&P 500 was down 2.1%, and the NASDAQ fell 3.1%. Foreign stocks (MSCI EAFE) were also down, falling 2.2%. Bond prices were down for the week, with the 10-year U.S. Treasury ending the week at 4.44%.  (Data source: Wall Street Journal)

October CPI Report

The October CPI (consumer price index) report was released last week and ticked slightly higher than September’s report. Headline CPI was 2.6% while core CPI (excludes food & energy) increased 3.3% year-over-year. These numbers came in line with expectations, so the market had little reaction to them overall. The Fed still says that their target inflation is 2% but many don’t see the economy getting there as we are still above their goal and at the same time, they are beginning to cut rates. The new normal for the foreseeable future may be an inflation rate in the 2%-3% range, still much lower than the 9.1% inflation we saw in June of 2022. The next Fed meeting is a month away and currently, the market is pricing in a 58% probability of another 0.25% rate cut.

Tariff Uncertainty

One policy that President-elect Trump has talked a lot about is imposing tariffs on imported goods. Tariffs put pressure on inflation to move higher but looking at the historical effects it typically is just a one-time increase. Unless there is an escalation in tariffs after they are imposed, typically it does not have a long-term effect on inflation. The other question investors have is if these tariffs are just going to be used as a bargaining chip for Trump or if he is going to impose them no matter what. This will be something to monitor throughout the next 4 years and watch for its impact on inflation.

Tesla’s Post-Election Bump

Elon Musk was one of President-elect Trump’s biggest supporters during the campaign and it has paid off for Tesla’s stock. Tesla’s stock is up over 50% in the past month as it is now worth over $1 trillion. There are now reports that the Trump administration will ease self-driving car rules which has caused another move higher for Tesla stock today. (CNBC) Uber’s stock is down today as the worry of a possible Tesla robotaxi fleet could be on its way in 2026 according to Musk. (Investopedia) Musk’s gamble of backing Trump looks to be paying off as there was worry restrictions would tighten on Musk’s companies if Harris had won the presidency.

Quiz:

How many American companies have a market cap of over $1 trillion? (Scroll Down for Answer)

  1.    8
  2.    11
  3.    13
  4.    17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answer below.

 

 

Have a Great Week!

 

 

 

 

 

 

 

 

 

 

 

Answer:

1. 8.  There are now 8 companies with a market cap of over $1 trillion. Those companies are, Apple, NVIDIA, Microsoft. Alphabet (Google), Amazon, Meta Platforms (Facebook), Tesla, & Berkshire Hathaway.

 

Investing involves risk, including the possible loss of principal. The information contained herein has been prepared solely for informational purposes. Nothing contained herein should be construed as a recommendation to either buy or sell any security or economic sector, or implement any strategy discussed. Please consult with your financial advisor, accountant, and/or attorney before acting on this information. MGO-Inc is a DBA of OneSeven.  OneSeven is an investment advisor registered with the U.S. Securities and Exchange Commission (SEC).  Registration with the SEC does not imply a certain level of skill or training.  Investment Products are Not FDIC Insured, Offer No Bank Guarantee, and May Lose Value.