Daily summary: Wall Street rallies; Dow Jones touching all-time high after Trump victory 💵US dollar gains amid rising yields

• Donald Trump has won the presidential election. U.S. indexes posted impressive gains today, although the sentiments in European markets were not proportionately optimistic today. Germany's DAX lost more than 1%, and France's CAC40 retreated nearly 0.5%. Declines were also recorded by contracts on Chinese indices
• The Nasdaq 100 and S&P 500 gain more than 2%, and the DJIA is up more than 3.2%. However, a record session is scored by the Russell 2000 index of small and medium-sized companies, which records a 5% rally. Among BigTech stocks, Nvidia is the strongest gainer today, at nearly 4.4%
• Yields on 10-year U.S. bonds are up 12 basis points today to 4.41%, while EURUSD loses 1.6%, slipping to 1.075. Nearly 2% gains are recorded by the USDJPY pair, where the yen was pushed to the wall by a charging dollar.
• Under pressure from the strong dollar and profit taking were gold and silver, which are losing 3 and 5% respectively. Industrial metals are similarly losing heavily, where zinc and copper stand out, both commodities with nearly 5% declines. Agricultural commodities outside of cocoa and cotton posted modest gains today
• Tesla shares are rebounding 15% today, as investors assess that Trump's win will benefit the company by rolling back government programs needed by other rival manufacturers and competing with Chinese counterparts.
• Super Micro Computer's shares are losing nearly 25%; the company beat profit forecasts in preliminary unaudited results, but disappointed sales; it also issued surprisingly cautious expectations for the final quarter of the year (fiscal Q2 2025)
• Double-digit declines were recorded by stocks related to the photovoltaic panel market like First Solar and wind companies like Orsted and Vestas. Investors expect that the new administration will not favor subsidizing these industries from the national budget
• Aerospace and defense stocks are gaining; HEICO Corp is up nearly 3%, with Textron posting a 6% rally. Navy ship supplier Huntington Ingalls notes a more than 6% rally. Leading defense companies like Lockheed Martin, Northrop Grumman and General Dynamics gain in the 1 to 3% range.

Change in US crude oil inventories (weekly change): 2.149 million barrels (-300,000 barrels expected; 515,000 barrels earlier). Oil contracts are currently losing slightly, although the initial reaction to the report was surprisingly positive. Natural gas, on the other hand, is gaining more than 3%.

Gasoline: 412 thousand (expected -0.977M; earlier -2.707M)

Distillates: 2.947M (expected -1.500M; earlier -0.977M)

• The cryptocurrency market is posting massive gains. Bitcoin is oscillating around $75K, while Uniswap, AAVE and Phantom are gaining in the 15 - 30% range. Dogecoin gains 14%, following in the footsteps of Tesla shares.
• According to the ECB's Villeroy, Trump's win means higher inflation risks in the U.S., and the likelihood of an increase in the deficit from the current high levels already in place. 
• Investors expect that protectionist policies and tax cuts will put pressure on the Fed, which will be forced to maintain higher rates for a longer period of time, in the face of solid macro data and the risk of a return of price pressures. Currently, markets are already fully pricing in just one rate cut in the US, this year, and a 100 bp cut next year, over the first three quarters.

The pharmaceutical sector is losing ground as there is a perception that Republicans will not look favorably on the business of pharmaceutical giants, whose actions Donald Trump has repeatedly criticized. Eli Lilly and Novo Nordisk are losing more than 3%; downward pressure can be seen in the shares of Pfizer, BIONTech and Moderna. The session is dominated by gains in the IT sector, banks and financial institutions, and insurance and equipment manufacturers, where Caterpillar is up nearly 9%. Source: xStation5