The global market experienced significant gains this week, fueled by a combination of factors, including the stability of benchmark lending rates, strong performance in the financial sector, and anticipation of policy changes under President Trump's second term. Investors are cautiously optimistic about the potential for growth under Trump 2.0, while also acknowledging the inherent risks associated with any significant change.
This report originates from today's CNBC Daily Open, our international markets newsletter designed to keep investors informed about crucial market developments, regardless of their location. Interested in receiving these updates directly? Subscribe today.Today's global markets witnessed a notable shift, with the benchmark lending rates remaining unchanged on Friday. Amidst this stability, the S&P 500 surged to its highest point since December 31st.
Mainland China's CSI 300 index also experienced a positive uptick, adding around 0.5% as Beijing maintained its loan prime rates.On a global scale, Oxfam reported a dramatic surge in billionaire wealth, jumping to an estimated $15 trillion from $13 trillion in 2024. This marks the second-largest annual increase in billionaire wealth since Oxfam began tracking such figures. The organization predicts that with the current acceleration in wealth accumulation among the ultra-rich, there will be at least five trillionaires within a decade.Investor sentiment is also closely tied to upcoming policy changes, particularly those implemented in the early days of a new presidency. These policies, particularly those concerning tariffs and corporate regulations, can significantly influence stock market trends extending far beyond the immediate future.In recent weeks, the market has exhibited a cautious response to the anticipated policies of the new president. The S&P 500, which initially surged above the significant 6,000 level following the previous presidential election victory, has largely erased its gains and returned to pre-election levels. However, as the new president prepares to take office, investors are beginning to position themselves based on his anticipated agenda. Stock performance finally ended last week on a positive note, marking their first weekly gain of the year.The financial sector played a pivotal role in this upward trend, with better-than-expected earnings reports from major banks propelling their share prices higher. Shares of Goldman Sachs, for instance, climbed 8% during the same period. Overall, the financial sector rallied more than 6% last week, outperforming the S&P 500. Trump's presidency is anticipated to provide further momentum for bank stocks. Potential drivers include rising business and consumer confidence, the extension of tax cuts, and deregulation within the financial industry. Chris Senyek, chief investment strategist at Wolfe Research, expressed this sentiment, stating, 'We still see Financials as the biggest sectoral winner under the Trump administration.'However, investors remain cautious. Any significant change inherently involves increased risks. While the second term of President Trump offers a degree of familiarity, as the 'two' indicates, uncertainty still persists. To receive the CNBC Daily Open report every morning and stay informed about global market movements, subscribe today
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