Trending On Livewire: Weekend Edition - Saturday 16th November
Post-election, US markets surged, while Aussie stocks stayed flat. Bulls cite optimism; bears warn of high valuations and inflation risks.
Not every week in markets is going to be a humdinger. After the excitement of the past few weeks, the last five sessions have been relatively pedestrian. The world has collectively exhaled post the US election, but it won’t be long before we’re holding our breath again – possibly into January 20 next year when Trump is sworn in. In the meantime, it’s back to the regular bull and bear ballet.
This week in the US, the major story has been the bond yield backup, driven by concerns around potential Trump policies - particularly when it comes to tariffs and deficit. Will his fiscal irresponsibility lead to higher inflation and renewed economic challenges? Time will tell.
Both Stateside and locally, the bears are pointing to stretched valuations and overly aggressive positioning, following the rally of the past couple of weeks. Conversely, the bulls are pointing to positive seasonality, FOMO, and the animal spirits being alive and well. At this point, things are finely balanced. But let’s face it, it’s more fun being a bull. Have a great weekend.
Chris Conway, Managing Editor, Livewire Markets
Why Geoff Wilson is keeping some dry powder for the coming cycle
In our high-tech world, the thought of wandering over to the stock exchange for a printout of BHP’s results sounds foreign. That, however, is exactly what Hall of Famer and industry stalwart Geoff Wilson AO found himself doing 44 years ago, fresh to the industry. Wilson has seen his fair share of market cycles but a thirst for information has served him well over the years. In this episode of Views from the Top, Wilson shares lessons and anecdotes from his journey, along with why he is holding dry powder for the coming cycle. He also answers the question: will he retire?
5 ways to turn down the noise, stay focussed (and survive Trump)
One could be forgiven for thinking that the list of things for investors to worry about is more threatening than ever, and that it’s getting harder to make sense off. Most recently, the confusion around what Trump will mean has gone into hyperdrive lately. While these policy announcements and the risks around them are real and cannot be ignored, the danger is that all this noise is making us worse investors as we lurch from one worry to the next. The key to investor success is to stay focussed. In this wire, I'll give you five tips to do just that.
Top 3 Wires this Week
Some of the best wires from our Contributors this week:
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Equities
Pharma & biotech stocks on the move in October
View
The $500 million Trump trade that’s still roaring
Last week’s chart discussed the effect of Trump’s victory on stocks. But that rally appears to have fizzled - even if only temporarily. That same explanation can also be applied to bond yields (the yield rally has fizzled) and currencies (the US Dollar Index is at April 2024 highs but its pace of gains has also fizzled.)
So for this week’s chart, I thought I’d refer to one of the Trump trades that hasn’t fizzled - Bitcoin. In the last month alone, Bitcoin’s market capitalisation has soared US$500 million. As of this chart’s snapshot, the price of Bitcoin is well over US$90,000 per unit. Bulls are now staring down the barrel of a US$100,000 price tag before the end of the year while the bears have been left simply gobsmacked.
Weekly Poll
In this wire, Livewire’s Hans Lee discusses the latest Bank of America Fund Manager Survey data, which shows that 43% of fund managers believe US stocks will be the best-performing asset class in 2025. We’re putting the same question to you, with a few more options.
What will be the best-performing asset in 2025?
a) Aussie equities
b) US equities
c) Gold
d) Oil
e) Bitcoin
f) Private equity/credit
g) Something else
LAST WEEKS POLL RESULTS
We asked "Is a Trump victory a positive tailwind for markets?"
The poll results show that 39% are undecided about a Trump victory's market impact, 33% see it as positive, and 28% view it as a risk.
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Livewire Exclusive brings you exclusive content from a wide range of leading fund managers and investment professionals.
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Livewire Exclusive brings you exclusive content from a wide range of leading fund managers and investment professionals.
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