Focus on the Sustainability of Trump Trade: U.S. Stock Indices Hit Record Highs
Yesterday, in the overseas markets at the start of the week, the “Trump trade” became even more active, with major U.S. stock indices such as the Dow Jones, S&P 500, and Nasdaq all hitting record highs. Bitcoin also reached a new all-time high, and Tesla shares, led by Elon Musk, saw significant gains. The U.S. dollar strengthened, particularly after the London market opened, with the yen coming under selling pressure in the Tokyo market, reflecting a stronger risk-on sentiment.
Concerns Over U.S.-China Relations and Market Adjustment
Today, there are growing concerns about worsening U.S.-China relations following reports that the Trump administration is appointing hardliners, such as the Secretary of State and National Security Advisor. Additionally, last week’s National People’s Congress in China did not deliver the expected economic stimulus measures, which has reignited concerns. This has led to selling pressure on Hong Kong and Shanghai stocks, while in the currency market, the yen’s downward trend has paused. Although USD/JPY rose above the 154 yen level, it quickly fell back to the 153 yen range, and cross-yen pairs are showing signs of resistance.
Adjustment to Trump Trade and Concerns Over Intervention
As concerns grow over the deterioration of U.S.-China relations and risks associated with Trump’s policies, there could be an adjustment to the rapid rise of the Trump trade. This may lead to a temporary pause in the “Trump trade.” However, given how widespread the theme has become, it may persist as a long-term market theme. Today, attention will be focused on the extent of this adjustment.
Key Economic Indicators and Events to Watch Today
The following major economic indicators are scheduled for release today:
- Germany: Consumer Price Index (October final), ZEW Economic Sentiment Index (November), Current Account (September)
- U.K.: ILO Unemployment Rate (September), Average Weekly Earnings (September), Jobless Claims (October)
- South Africa: Unemployment Rate (Q3), Manufacturing Production (September)
- Brazil: Retail Sales (September)
- Canada: Housing Starts (September)
Additionally, the following central bank officials are scheduled to speak:
- Austria National Bank Governor Holzmann
- Finland National Bank Governor Liikanen
- BoE Chief Economist Pill
- Portugal National Bank Governor Centeno
- ECB Board Member Cipollone
- FRB Governor Waller
- Richmond Fed President Barkin
- Minneapolis Fed President Kashkari
Focus on Bitcoin and AUD Movements
Among cryptocurrencies, Bitcoin remains a key focus. Given the concerns over U.S.-China relations, there is also increasing selling pressure on the Australian dollar (AUD), which should be closely monitored as a potential point of interest.
