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- 👉 Election Time Volatility!
Welcome to your new week.
The U.S. Election Day is finally here. Remember… regardless of your personal preferences and your hope for the outcome — you are still in the driver’s seat for your life.
Politics and the government definitely matter. We regularly discuss the implications of government decisions on the economy and sometimes the stock market. However, you’re the CEO of your own journey! Remember that and enjoy popping some popcorn for Tuesday evening.
And by the way… do yourself a favor and don’t watch the news for days on end. Vote, and then remember that we’ve all got work to do and money to make!
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Key Earnings Announcements:
The heat of earnings season rolls on with Arm, Hims & Hers, Palantir, Qualcomm, and more…
Monday (11/4): Berkshire Hathaway, Constellation, Franklin Templeton, Hims & Hers, Palantir, Wynn Resorts
Tuesday (11/5): Apollos Global Management, Ferrari, Super Micro Computer
Wednesday (11/6): Arm Holdings, AMC, Celsius, CVS Health, Novo Nordisk, Qualcomm
Thursday (11/7): Arista Networks, Arbnb, Barrick, Block, Carlyle Group, DraftKings, DataDog, Fortinet, Gero Group, Moderna
Friday (11/8): Embraer, Icahn Enterprises, Sony
What We’re Watching:
Arm Holdings (ARM)
ARM Holdings (+88.3%) shows promising growth potential as more chip designers, including Nvidia and AMD, plan to release ARM-based CPUs and GPUs starting in 2025.
Currently, ARM-based PCs hold a 9.7% market share — with many analysts expecting it to increase because of advantages in power efficiency and customization. However, ARM's high valuation (FWD P/E of 97x) and conservative FY2025 guidance have raised concerns about near-term SaaS monetization and cash flow consistency.
Currently, ARM stock price is in the $150s, supported by bullish sentiment ahead of Q3'24 earnings. Market analysts are watching closely — especially with Microsoft’s exclusivity agreement with Qualcomm set to end in 2024 — which could accelerate ARM's market penetration in the coming years.
Arm Holdings (ARM) Stock Performance, 1-Year Chart, Seeking Alpha
Palantir Technologies (PLTR)
Palantir Technologies (+144.2% YTD) is set to release Q3 earnings after the market closes today. The firm has forecasted Q3 revenue between $697M and $701M and adjusted operating income of $233M to $237M, following Q2’s 27.2% YoY revenue growth. Palantir's recent addition to the S&P 500, increased demand from both government & commercial sectors, and constant new partnerships highlight its sustained momentum.
Notably, Palantir secured a $178.4M contract to develop AI-powered TITAN prototypes for long-range precision in defense and a $99.8M contract with the DEVCOM Army Research Laboratory to expand AI access across multiple military branches.
Further strengthening its defense focus, Palantir’s recent partnership with Microsoft (MSFT) will integrate AI and cloud solutions to support critical national security missions within Microsoft's classified cloud environments. With 11 upward EPS revisions in the last 90 days, Palantir remains positioned for robust growth in AI and defense capabilities.
This is a stock that has absolutely ripped and Palantir CEO Alexander Karp has recently sold over $300M worth of shares. It’s a make-or-break moment for PLTR if it wants to continue upward momentum.
Palantir Technologies (PLTR) Stock Performance, 5-Year Chart, Seeking Alpha
Investor Events / Global Affairs:
U.S. Presidential Election, The Future of AI Conference, & Nvidia/Intel swap places in the Dow.
Election Day
The 2024 presidential election on Tuesday, November 5th will be the most pivotal moment of the week, despite an unusually calm lead-up. October saw the second-lowest volatility for an election year in five decades, and the S&P 500 has posted a strong +20% YTD return.
Markets seem to be relatively prepared for either candidate to win.
Investors are long U.S. equities heading into November, more than they ever have been before a Presidential election. We're heading into the historically strong months for the S&P 500, and it will be interesting to see how rate cuts and the election influence this trend.
Not to mention — it will be very interesting to see how the markets could react if the election gets dragged out over many days. Whichever side wins — we would think that the market would appreciate a decisive victory.
“Markets continually crave certainty, which such a result would provide, and allow those who have hedged election-related risk to unwind those positions and re-enter the fray.”
The Future of AI Conference
The Financial Times Future of AI Summit returns in 2024 to explore the state of AI innovation and its transformative impact across industries. There will be discussions with top experts on real-world applications, investment trends, and the economic and societal implications of AI.
This has become a world-renowned event and we’re expecting to see major headlines as a result.
This two-day, in-person event brings together leaders in strategy, technology, and business, offering insights on scaling AI for growth, navigating ethical challenges, and driving innovation.
Key partners and speakers include, Google Deepmind, Microsoft, AWS, IBM, & more.
Nvidia & Intel Flip Flop
AI leader Nvidia (+174.3% YTD) will replace Intel in the Dow Jones Industrial Average (DJIA) starting November 8 — reflecting Nvidia’s rapid rise and dominance in the AI chip market. Nvidia’s market cap of $3.32 trillion makes it the world’s second-most valuable company — driven by surging demand for AI products.
Intel, once a pioneering tech addition to the DJIA, has struggled in 2024 (-53.8% YTD) lagging behind Nvidia and AMD in AI chip innovation.
“The index changes were initiated to ensure a more representative exposure to the semiconductors industry and the materials sector, respectively.”
Major Economic Events:
The next Fed interest rate decision and key insights on consumer sentiment are both coming this week.
Monday (11/4): Factory Orders
Tuesday (11/5): ISM Services, U.S. Trade Deficit
Wednesday (11/6): S&P final U.S. Services PMI
Thursday (11/7): Consumer Credit, FOMC Interest Rate Decision, Fed Chair Powell Press Conference, Initial Jobless Claims, U.S. Productivity
Friday (11/8): Consumer Sentiment, Fed Gov Bowman Speaks, Saint Louis Fed Pres Musalem Remarks
What We’re Watching:
FOMC Interest Rate Decision
Source: CME FedWatch Tool
As the Federal Reserve prepares for its next policy announcement on Nov. 7, all eyes are on whether it will signal further rate cuts. While markets feel almost certain about a 25-basis-point cut, recent data on steady economic growth and persistent inflation challenges have led to adjusted expectations — with markets now pricing in about three fewer rate cuts through 2024 than initially forecasted following the Fed's September rate cut.
“Election aside, US policymakers have already communicated a desire to proceed with a more gradual pace of rate cuts after September’s half-point reduction.
Economists widely expect a quarter-point move on Thursday, followed by another in December — and their conviction grew after data on Friday showed the weakest hiring since 2020.”
Consumer Sentiment
Source: Surveys of Consumers University of Michigan
The University of Michigan’s consumer sentiment index for October 2024 was revised up to 70.5, the highest in six months and marking three consecutive monthly gains.
Both current economic conditions (64.9) and future expectations (74.1) saw upward revisions, reflecting modest improvements in durable goods buying conditions as interest rates ease. The upcoming election of course has large implications for consumer sentiment as well.
“All year, consumers have repeatedly told us that the trajectory of the economy hinges on who becomes the next president.
Given the close nature of the presidential race, many consumers will be updating their expectations of the economy after the election is resolved, and sentiment may be somewhat unstable in the months ahead as consumers form their views on what the next presidency will look like.”
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Cover Image Credit: Palantir Press Release / David Biedert
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