This week, the 'Trump trade' has once again become the tone of the US stock market, with major indices recording gains. The Dow Jones Industrial Average has risen by about 2%, the S&P 500 and Nasdaq have risen by about 1.7%, and the Russell 2000 Index has risen by 4.5%.
The market expects that US President elect Trump will implement tax cuts and relax regulations in his second term, which will benefit American businesses, especially industrial and small cap stocks.
The PCE data for October in the United States and the minutes of the Federal Reserve's November meeting will be the focus of market attention next week, and both reports will be released next Wednesday Beijing time. The core PCE price index is an inflation indicator favored by Federal Reserve officials.
According to currency market pricing, investors currently expect a slightly higher than 50% chance of the Federal Reserve cutting interest rates in December, with a total reduction of only 67 basis points from now until the end of 2025.
HSBC economists pointed out in a report that the minutes of the Federal Reserve's November meeting may reveal discussions among some policymakers about the potential economic impact of the US election results.
During his campaign, Trump repeatedly threatened to impose tariffs of 10% to 20% on all imported goods, which could lead to another rise in US inflation and force the Federal Reserve to slow down its rate cuts.
The Eurozone will release the initial CPI for November next Friday. The market is closely monitoring this report as more and more people expect that the European Central Bank may have to accelerate the pace of interest rate cuts, cutting interest rates by 50 basis points in December to rescue the struggling economy.
The Reserve Bank of New Zealand and the Bank of Korea will announce their latest interest rate decisions next week.
The market expects the Reserve Bank of New Zealand to cut interest rates by 50 basis points, and some even speculate that the rate cut may reach 75 basis points. Economists predict that the Bank of Korea will keep interest rates unchanged next week, but may hint at a possible rate cut in the future.
The trends of two important assets - gold and Bitcoin - next week are worth paying attention to.
After a significant pullback, gold prices have regained growth momentum this week. Spot gold has risen by about 6% this week, returning to above $2700 per ounce. This is mainly driven by the escalating situation between Russia and Ukraine.
Meanwhile, Bitcoin continues its strong momentum since Trump's election victory, rising above $99000 this week and approaching the $100000 mark.
In terms of financial reports, with Nvidia announcing its results this week, the Q3 earnings season for the US stock market is coming to an end. Among the companies that will release their quarterly reports next week, Dell Technologies, HP, and Meituan are worth paying attention to.
The US stock market will be closed for one day next Thursday due to Thanksgiving, and will be closed three hours earlier on Friday.
Overview of Important Overseas Economic Events Next Week (Beijing Time):
Monday (November 25th): Dallas Fed Business Activity Index for November in the United States, IFO Business Sentiment Index for November in Germany
Tuesday (November 26th): Consumer Confidence Index of the US Conference Board for November, FHFA House Price Index Monthly Rate for September, CBI Retail Sales Difference for November in the UK
Wednesday (November 27th): US PCE data for October, Federal Reserve releases minutes of November monetary policy meeting, US Q3 real GDP annualized quarterly rate correction, New Zealand Federal Reserve releases interest rate decision and monetary policy statement
Thursday (November 28th): US stock market closed for one day, Eurozone November industrial/economic sentiment index, Bank of Korea announces interest rate decision
Friday (November 29th): Eurozone November CPI preliminary value, Japan October unemployment rate, US November Chicago PMI, Germany November seasonally adjusted unemployment rate