Dow, S&P 500 and Nasdaq jump to record highs after Trump win. Plus, what the victory means for Tesla 11/6/24

0:02Live from the Nasdaq market site in the heart of New York City's Times Square this is fast money. Here's what's on tap tonight. Surging to records. Former President Trump once again, President-elect Trump. The election results sent banks ripping to new highs, industrials, transports, travel, even tech joining today's monster rally. Can this last or will tariff and trade fears end the euphoria? We'll debate that. Plus, the Musk trade, all things in the Elon universe rocketing higher from Tesla to crypto to the finance bro trade. Should everything and Elon's orbit be on your buy list. And later, another super meltdown for Supermicro, why shares of Novo Nordisk have gone on a diet in the last two months.

0:40And what's behind housing getting hammered ahead of the Fed decision? I'm Melissa Lee, coming to you live from Studio B at the Nasdaq. On the desk tonight, Tim Seymour, Karen Feinerman, Dan Nathan, and Guy Adami. And we start off with what might be a bit of post-election euphoria. Stocks surging to new records after Donald Trump was re-elected president, the Dow jumping more than 1 ,500 points, its biggest gain since April 2020. The Nasdaq and S &P also hitting all-time highs, while the small cap Russell 2000 gained 5.8 percent to post its highest close in nearly three years. Take a look at some of the sectors seeing the biggest gains.

1:12Bank stocks rallying on hopes looser regulation will spur IPOs and M &A. Energy up, too, as expectations for oil-friendly policies rise. And big tech also sharply higher, led by gains in Tesla and NVIDIA. But it wasn't green across the board, stocks that stand to take a hit from increased tariffs like Dollar Tree, Dollar Gen, both dropping sharply along with retail across the board. Same with solar stocks and cannabis names. But can today's market momentum be sustained? Will the policies the market seems to be hoping for play out in reality? Guy, what do you think? Fascinating, right? I mean, there are a couple amongst a lot of things to watch.

1:46The two things I was watching most closely were the bond market, which we'll talk about, and then the Russell. And you mentioned small caps. I I mean, that's been the final piece to this puzzle. Will the small caps finally make a new all-time high? And we got close. I think the prior high was November of 2021. Here we are within, you know, a few dollars of that level. That's sort of, I think, the catalyst for everything else. But to answer your question specifically, I mean, you had some pretty remarkable moves, some really outside moves on some huge volumes. That's typically suggestive of a little bit of what we call a blow-off top.

2:16And in some individual names, that might be the case. But it's hard to argue with just sort of the lower left, upper right that we've been enjoying. I shouldn't say we. Other people have been enjoying for quite some time. It could be the certainty of the election. It could be Trump policy specifically. We are entering a period where seasonality comes to play. November is a huge buyback month also for companies. November on its own would have been a reason, along with the Fed cutting and what we've gotten from earnings season, which I think has been solid, solid enough. And and but look, I think you got the the red sweep dynamic, which I know is still not official and maybe it's not.

2:52But if you look at what the market did from almost 730 p.m. last night or eight o 'clock when Florida started to give a window into what might happen in other battlegrounds. And I know Florida was not supposed to be battleground, but certain counties were a read on where you were going to see possibly a change in the vote. So the reason I'm bringing all this is up is because you had a move in S &P futures that largely went sideways for the rest of the night. You had a move in the 10-year, which largely went sideways all the way through today. But the difference between where we were, whether it was at 1030 last night or at 230 in the morning, is when you started to sniff out that this could be a clean sweep is when I think the market started to take that next leg higher.

3:30What's interesting to me, though, is that the things that moved both last night and today or all in the same are largely the same things that had been outperforming. Look at the banks. Look at financials. Look at where we've seen some of the industrials. Look at airlines. I mean, it was as if this was a ratification of a rally that was already underway. You know, we'll talk. We have talked what was already priced in with betting markets, crypto markets seem to have called it. I think these other stocks have been calling it as well. I mean, it was really fascinating how all of the pieces seem to be reflecting what we think is the mandate from Trump.

4:04But you had so lower regulations, banks. That's big for banks, not just from a regulatory standpoint, maybe a capital standpoint as well, easier to run their business. Banks, we know, have been talking about how constrained they feel by what they see as more oppressive regulations, but also for the rest of their businesses like M &A, which maybe will be different. And then for asset wealth management, to the extent the market goes up, we've seen that that's good as well. Some of the ones that are interesting to me were the flip side, the REITs, for example, If you're highly indebted, right, higher rates, that's not a great thing.

4:41And we saw rates really move a lot. Tim talked about it, but they continue to move. Right. That was those were some really, really big moves. And then the other the mix on things that are in the retail space, whether or not you import. Right. And what will happen there. But for some other companies, you know, if taxes are lower, then that's good for their bottom line. Right. Corporate tax, personal tax as well. I don't know. It was sort of fascinating to see all those things happen. And then crypto as well. The other thing that was interesting to me is the magnitude of the move and how it wasn't priced in at all.

5:16We saw the stocks rise and we thought, oh, is it anticipating a win? And yet it hasn't, obviously, because of today's move. Right. That was sort of amazing, the magnitude in so many areas. Yeah, what sticks out to me, you know, one of the first tweets that I saw someone forward to me was like from Jeff Bezos. We know he's not the CEO anymore of Amazon, but he also had a bit of a target on his back going back eight years ago. Right. So Trump had a very after a little courting of the tech community and really just, I guess, the CEO community in general. They set up all those CEO councils, but they quickly moved against him for policy reasons that actually didn't have a whole heck of a lot to do with the economy at the time.

5:53Now, they were they did move against him on some of that stuff later. But now everybody's just falling in line, you know, and I think it's interesting. I think he knows a lot more about how to deal with these sorts of folks. And I think it's interesting that, like, you know, Bezos and all these other guys, they've just been really quiet this whole period. I think they were more worried about the implications on their companies if they came out. You know, it's funny, like Jamie Dimon is a great example. So he wouldn't say a word. Going back to Davos, you know, he said, well, there's some good things that we're doing.

6:18That's fine. He has a massive fiduciary responsibility to do that. But he's also the sort of guy that disavowed January 6th. Right. And we saw a lot. The Muslim ban. People forget that was right after the inauguration. There was like a million people marching in New York, and there were lots of CEOs that joined that sort of course. So I think what's interesting going forward for this next four years is that he's got all those guys in his pocket. He's got the Supreme Court in his pocket. He's got the House and he's got the Senate. And I think that's what's really different this time about what we are going to expect going forward, because, you know, there's nothing kind of holding back.

6:50There's no checks. There's no balances. There's nothing. It's just him and there's no one willing to stand in his way. Well, in terms of the market, what potentially could is valuations. And we say it all the time. You know, you don't it's not a timing mechanism and we're not saying it is. But, for example, Warren Buffett's cash position at Berkshire Hathaway is now three hundred and twenty five billion dollars with the B, the largest it's ever been. And that's been being built over the last six months or so in the form of obviously selling off Apple, probably a positioning thing, but Bank of America and some other names.

7:18So one has to wonder what does he see? And I'll sort of try to answer my own question. He sees now his indicator, the Wilshire 5000 divided by GDP, is now north of 203 percent. And for context, it flashes red for him at about 130 percent. So when you're talking about two or three standard deviations away on valuation, it's something to be concerned about. Now, again, nobody cares right now about that stuff. But at a certain point, especially if yields continue to move higher like I think they will, the market will start. Right. I look at both what the bond market has done and obviously the equity bond yield or 10 year yield, whatever you're looking at relationship and where it starts to matter for equities is also part of the fascination here.

7:58Also interesting to hear at least prognostications on, OK, so we have some policy ideas. We've certainly heard about tariffs. If you get 60 percent on China and if you get 10 percent on the rest of the world and those aren't those are numbers that were thrown out there. It doesn't mean that they're going to happen. But you're starting to get strategists and economists out there say, well, That's actually a one percent drag, one point drag on GDP by 26. It's a six percent hit to corporate profits by 26. I mean, there are dynamics that the market can start to wrestle with in the short run. I bring it back to November.

8:25I bring it back to positioning and I bring it back to. I think that despite Warren, who you should always be listening to and his conservatism will prove right, I'm sure at some point. I think a lot of people are offsides. I think there's a squeeze into year end. I think there's a lot of people that are panicking. I think there's a green light and everything with the deficit and everything with the yields and everything with the dollar and things that indicate there could be bigger issues don't happen in the next two months. So it gets back to where are traders right now? And I think, again, follow the path of where crypto has made a call.

8:56I think some of that call actually translates into a risk on aggression. How many market participants have we had on CNBC leading up to the election saying that they are de-risking, they're advising clients to de-risk, and that we are preparing for a prolonged election where we don't even know the results the next day, maybe weeks afterwards? And here we are. There was certainty pretty early on in the markets, as to Tim's point, not ready for that clean sort of policy. Peaceful transfer of power, seemingly. Well, you saw the VIX come in, 20 percent. That's a very big move. I do think that's somewhat underpinning the rally, that there's certainty at least on who the winner is.

9:31Yeah. All right. Our next guest says regardless of the Senate and House outcome, there will be large implications for the deficit. Let's bring in Evercore ISI, Sarah Bianchi. Sarah, great to have you with us. I do want to get to the deficit and we were just talking about bond yields. But, you know, in terms of in terms of tariffs, that seems to be sort of the looming issue here over this, you know, euphoric stock market rally here. What could that be? We've seen a lot of estimates from folks like the NRF saying it's going to add, you know, 10 percent to the price of clothes, 33 percent to the price of toys.

10:00What do you how do you think that plays out? Well, I do think that the second Trump term will be very aggressive on tariffs. I agree that he is not going to implement 60 percent across the board imports on all imports from China or 10 percent across the board. But last time, President Trump took the tariff rate all in in China from 3 percent to 10 percent. And I expect he'll be equally as aggressive this time, if not more so. I do think that they'll focus on particular sectors as they did last time and leave some of the consumer stocks perhaps alone. But I do think they're going to be very aggressive.

10:39And we think that the Trump trade team knows exactly what it's doing this time. It knows exactly where the authorities are. And we think most of it can happen without Congress's approval. So we think they will move quickly on a 301 on China and then start focusing, whether it's on steel or the digital tax with Europe or Mexico, as the president said just a few days ago on the campaign trail. We think they're going to be fast and furious here and everybody should be on alert. Sarah, it's Tim. Thanks for joining us from your policy perch. How about the Fed and how about what Washington's thinking about an independent central bank that now has a different, at least, dynamic to really deal with?

11:19I mean, there was the prospect of this. There was the prospect of deficit unfriendly and inflation and higher yields. What do you think? Has anything changed for the Fed tomorrow? Could we get a statement that at least is now reflective of a new paradigm in politics? I believe that President Trump in his second term will really stay within the by and large the norms in and around the Fed. Obviously, unlike other presidents, he's chosen to jawbone the Fed before and be critical publicly. We don't typically see that from Republicans or Democrats. But I don't really, my base case, at least, is that he's not going to do things like threaten to fire Powell or talk about how he needs any kind of authority there.

12:03That's our base case. We also think that he'll have at least a Treasury secretary that is friendly to financial markets. But there are, of course, real risks that that is not the path he goes down. And again, we do believe there will be a very, very active group with inside the White House and in the cabinet, very, very focused on tariffs and immigration, which lead to things in our estimates around inflation and growth that the Fed's going to have to take a real look at. Sarah, is there any talk down there in terms of what potentially could, if it is, does this potentially give a green light for China to do something in Taiwan or is that not something on people's radar screen?

12:46I think China has been very much thinking about and preparing for both outcomes here. And it knows with really both administrations what it was going to get. I do think there's a lot of strategic thinking in China about how they will approach a second Trump term in and around tariffs, export controls and a range of other things. My own view, a lot of different views on this in Washington, is that Taiwan and any kind of invasion or aggressive action there is not on that top of the list. We should certainly all hope so. I think that they are in their own set of challenges right now, and they have now have to figure out how to deal with, again, what is likely to be another trade war and tariff war with the United States.

13:37Sarah, it's Karen. Thanks for being on today. So you said if they do some of these what could be inflationary policies, the Fed's going to kind of have to look at that. But we're obviously we're dealing with monetary policy and fiscal policy. What do you do if you're the Fed and you only have the tools that are available to you? Do you ignore that? What do you do? How do they proceed? Well, I think generally what you see the Fed do is wait, in fact, until they see data and policy. So they are not going to be reacting today or tomorrow or really in January. They're going to wait and see the data, what policies are implemented and what the implications are on inflation.

14:15We know with President Trump there's a lot of rhetoric. There's a lot of back and forth. He likes to negotiate by starting really large and then coming backwards. So I think they're going to wait and see how this actually plays through the economy and what economic data they see. And they'll make any decision accordingly. But the markets, businesses, you already saw the National Retail Federation coming out today saying, watch out with these tariffs. So the rest of Washington is gearing up for a fight. Sarah, great to have you with us. Thank you. Sarah Bianchi, Evercore ISI. Bitcoin, meantime, surging to a new all-time high in the back of the election results, jumping to more than$76 ,000.

14:58Traders expecting a more crypto-friendly administration come January. The dollar also getting a bump on hopes of a more protectionist trade policy from the president-elect. So we saw the corollary reaction to the dollar strength, weakness in other currencies, weakness in commodities, softs, as well as hard. Yeah, and weakness in gold. And again, gold gave up a lot of ground and certainly had rallied on the lack of predictability to what's going on here. And it had just a massive run. So I actually, buyer of weakness in gold probably should surprise people. I'm pretty bullish in gold. And I think even some of the things that happened last night give you reason to be bullish in gold.

15:34I think overall you've got a dynamic of commodities where I thought copper's move today was interesting because it signaled to me more concern. If copper is Dr. Copper in terms of the health of the overall economy, it wasn't really a great day, was it? And it wasn't the sense that you got from looking at some of the materials names that won't necessarily be in the middle of some kind of a tariff war. They didn't trade well. They didn't speak well about the economy. Yet equities, including industrials and parts of the economy that are traditional economy stocks, loved it. Yeah, interesting, though, going back to China and that last conversation.

16:08I mean, you think about the Chinese, their meeting this week, and, you know, we might see more stimulus. You would think that that might be the sort of thing that would get some of these commodities going. It's been their, what, third kind of bout of it over the last two months or so. I also mentioned Taiwan Semi, the guy's question that he has for Sarah. is that this stock was one of the few that was down in the mega cap semi-space and tech in general. So again, maybe some trepidation there. And then this was kind of curious to me. I don't know if you guys can explain this. Why was the K-Web down?

16:34You saw Baba. You saw Pindadao. So you saw a lot of Chinese consumer-facing Internet names down. So all signs really appear that we are going to see some ratchet up tension. And the last thing I'll just say, I know we're connecting a lot of dots here, but North Korean soldiers entering the fray with Russia, That's a complicated case because we did have China. A lot of that dialogue was also dealing with North Korea a lot. And I wonder if that was just a wedge to kind of get some sort of solution going in Ukraine. All right. Let's get to an earnings alert here. We got a huge move in shares of Lyft on strong guidance from the company after our Zutro.

17:08Both has got all the details. Debo. Hey, Mel. So shares are surging. It is still the much smaller, less profitable, less diversified ride sharing play. there was a lower bar, but investors very encouraged by the more than 32 % revenue growth, better guidance and free cash flow, a suite of AV deals this morning, and that DoorDash partnership that was announced just a few weeks ago. Now, coming into the print, shares were down 4 % year-to-date versus Uber's gain of about 20%. Hanging over the rideshare complex more broadly is this threat of robo-taxis. Do they eventually kill off ridesharing altogether, or can the platforms incorporate the Waymos and Cruises and others that will come out in that robo-taxi space.

17:52Now, I spoke to CEO David Risher about the results, and I asked him about that Dash partnership. He said there's overlap between the two customer sets, but it's smaller than people think, and it will drive bookings over time. It'll drive ride frequency. Already seeing, he says, quick adoption of linked accounts. Guys, the CFO, that call, the earnings call is ongoing right now. Now, the CFO is talking and they haven't quite got to Q &A yet, but we'll continue monitoring it. Mel. All right. Debo, thank you. Keep us posted. Deidre Bosa on shares of Lyft, which is, of course, the L in Liza. So weird.

18:25So weird. I don't even know what that name is, what it means. But Lyft, those partnerships, the DoorDefs partnership, that has been the story for Uber, which at one point, of course, was the albatross for Uber, which was that it was too complicated. We wanted the pure play. People wanted Lyft at one point. The normalization to me and the margin story and the kind of the recovery and demand is, again, another one of these stories I think is slowly happening across a couple of other places, especially both in industrials and transportation. So I think the Lyft story, I think the driverless car dynamic and where that was a threat, that actually might actually be an ally at this point.

19:02I'm not sure Lyft should be responding one way or another. They should care a lot more about getting this business close to as profitable from a margin perspective as Uber. I think you stay long. Mark Mahaney, a while ago when we had him on a show like months ago, said that autonomous driving is actually a very good thing for Uber and Lyft. And under a Trump administration, there is a belief that FSD, full self-driving, would be fast-tracked, which could, in theory, if that is the case, benefit these guys. We've seen a little of that without question. Uber's had to speak self, so maybe there's some opportunity there.

19:31But, you know, if you're trying to figure out, I think, where to take profits and lift, look at the March high-ish. I think it was about$20.85. I mean, where are we, about 17.5 now? There's still some upside, but that's sort of your bogey, I think. Coming up, more market reaction to the election. Bank stocks is ripping higher on deregulation hopes. Just how much could the financial trade benefit? That's next. And we're watching some after-hours earnings action. Chairs of Qualcomm and Arm Holdings just reporting results heading in opposite directions. Details from those quarters when Fast Money returns.

20:08Welcome back to Fast Money. Bank stocks going ballistic on the back of a Trump presidential victory. The regionals leading the way, boosted by massive gains in names like Webster, First Horizon, Zion, Citizens Financial, and Huntington Bank shares as investors gear up for the potential of looser regulations and a surge of M &A in the space. Leslie Picker's got more on this reaction in these banks. Leslie. Hey, Melissa. Ironically, today's 13 plus percent surge in the KRE is the best move since November 9th, 2020, which was, of course, a few days after Biden was elected president. At that time, the KRE surged 15 and a half percent, largely due to a jump in bond yields.

20:47Now, today's strength comes after gains in recent weeks that put the KRE back above levels right before the mini crisis in the spring of 2023. And as you mentioned, Mel, deregulation is a key theme here. KBW identified eight agencies relevant to the industry that could see changes at the top on day one of a new administration. The watering down of current regulations on banks is expected to impact everything from the Consumer Financial Protection Bureau to capital rules to intra-industry mergers. However, just like four years ago, there was also a sell-off in bonds today. The moves, particularly at the long end of the curve, stem from concerns about higher deficits and sticky inflation.

21:29And while a steeper yield curve could benefit bank margins, higher for longer rates could also pose challenges to credit quality and unrealized balance sheet losses. And as KBW notes, today's, quote, understandable knee-jerk reaction brings the group to about 1 to 2 percent from historical multiples, raising the question of whether investors want to be chasing the rally from here. Mel. All right. Leslie, thank you. Leslie Picker. Karen, it's interesting the reactions were very similar to when Biden was reelected. So what is different today that makes this rally maybe more sustainable, perhaps?

22:03It's like a Passover question. Why is this night different? Okay. I'm not really sure why it's that surprised me, that Biden statistic. But I think today, I mean, so so many fronts we talked about before about the economy being better and less regulations and maybe more M &A. Then there's the yield curve part. And that has generally been better. To Leslie's point that I think is an important one. Bank of America was up less than the group because, remember, they do have that very big hold to maturity that with the move that we've seen in rates, that's not really helping them. So for me, I mean, I'm happy, you know, J.P.

22:39Morgan's a nice-sized position, but I would not chase it here, actually. I would probably be looking to sell some upside calls. So you know that expression. It's not a Passover expression, but history rhymes, you know what I mean, often and doesn't repeat. You know, think about the deregulation, the rollback of Dodd-Frank in 2018 under former President Trump's administration that led to the very rules that allowed SVB and some of these other regional banks to operate under different, you know, like regulations that ultimately were their failure. So you think about what's going on here with the KRE, you think about these mega cap banks, what does it mean?

23:12It's going to be a free for all or we're going to have the sort of practices that led to that sort of thing. So to me, you know, I think if we think about regulation over the last, you know, kind of 20 years, there's actually been some guardrails around this thing. You see the sort of performance today. That doesn't feel natural to see some of these banks, the size of their moving in that direction at that speed. I think that's fair. I think getting back to what drives bank earnings, I look at, first of all, tighter credit spreads are something else that I think are also a relief for a lot of these banks that had some concerns.