US fairness funds document $140bn of inflows on Trump’s ‘pro-growth’ agenda

Immediately’s agenda: Macron vows to remain on; DEI on the retreat; Yoon faces impeachment vote; Massive Learn on Chinese language exports below Trump 2.0; and the FT’s most influential girls of 2024

Good morning. Traders have pumped virtually $140bn into US fairness funds for the reason that election, making November the busiest month for inflows on information stretching to 2000.

What’s behind the surge? Merchants are betting that Donald Trump’s vows to chop laws and taxes will probably be a boon to company America. One fund supervisor cited the president-elect’s “market-friendly” picks for high posts, together with financier Scott Bessent for Treasury secretary and crypto fanatic Paul Atkins as Securities and Change Fee chair. A Deutsche Financial institution strategist additionally stated strong projections for financial progress, company earnings and family money balances steered the pattern of recent inflows may proceed into subsequent yr, albeit at a slower tempo.

Why it issues: The flood of recent cash has helped to drive the main US inventory indices to a collection of document highs — the S&P 500 has risen 5.3 per cent since election day — with merchants shrugging off issues that Trump’s deliberate tariffs may drive up inflation and threaten additional rate of interest cuts. Whereas the US has constantly outperformed areas comparable to Europe in recent times, the query is whether or not this narrative of “American exceptionalism” has gone too far of late. The US is “over-owned, overvalued and overhyped”, Ruchir Sharma wrote this week. “As with all bubbles, it is hard to know when this one will deflate, or what will trigger its decline.” Learn extra concerning the document inflows.

For extra on markets from Rob, join the Unhedged e-newsletter right here for those who’re a premium subscriber or improve your subscription right here. Right here’s what else we’re holding tabs on in the present day and over the weekend:

• Financial information: The EU publishes its third-quarter GDP estimate, Germany releases its industrial manufacturing index for October, and the US has jobs figures and information from the College of Michigan’s client sentiment survey.

• South Korea: President Yoon Suk Yeol faces an impeachment vote tomorrow. The nation’s central financial institution chief instructed the Monetary Instances that the martial regulation disaster had delayed essential financial reforms however that Trump’s tariff threats had been of higher concern.

• Elections: Ghana holds presidential and parliamentary polls tomorrow. Romania has a presidential run-off vote the subsequent day, tainted by official accusations of Russian meddling.

Be a part of us subsequent Wednesday as Monetary Instances editor Roula Khalaf and different FT specialists talk about their predictions for the world in 2025. Register right here.

5 extra high tales

1. Emmanuel Macron has vowed to not step apart earlier than the tip of his time period, saying opposition events “chose chaos” by bringing down his premier in a historic no-confidence vote. The French president’s time period runs till 2027, however the ousting of Michel Barnier’s authorities is fuelling opposition requires him to step down early.

2. A US decide has rejected Boeing’s responsible plea settlement stemming from twin crashes of the 737 Max, citing variety, fairness and inclusion issues in deciding on a company monitor to supervise compliance with the deal. A decide in Texas stated utilizing the factors would “undermine confidence” that the choice was primarily based on competency.

• DEI pullback: US firms are accelerating their retreat from such initiatives amid an all-out assault from conservatives emboldened by the election of Donald Trump.

• ‘Anti-woke’ ETF: A brand new fund aiming to punish firms targeted on DEI is making Starbucks its first goal.

3. Unique: Thames Water has obtained a bid from Covalis Capital that will see France’s Suez flown in to assist handle a break-up of the UK’s largest water utility earlier than itemizing it on the inventory market. The proposal got here forward of yesterday’s deadline for indicative bids for Thames, which is saddled with almost £19bn of debt and dangers operating out of money within the new yr.

4. Donald Trump has named enterprise capitalist David Sacks because the White Home’s synthetic intelligence and cryptocurrency tsar. Sacks, a confidant of Elon Musk, was one of many earliest and most vocal Silicon Valley supporters of Trump, internet hosting a fundraiser for the candidate in San Francisco in June. Right here’s what we all know concerning the former PayPal govt.

5. The taking pictures of a UnitedHealth govt in Manhattan has triggered broad issues about company safety, with giant firms speeding to evaluate whether or not their high workers have enough safety. Safety chiefs of teams on each side of the Atlantic are sharing intelligence and making inquiries with specialist firms on defend high executives.

• ‘Deny’, ‘defend’, ‘depose’: New York detectives are investigating inscriptions of phrases on bullet casings left on the scene of govt Brian Thompson’s homicide.

How properly did you retain up with the information this week? Take our quiz.

The Massive Learn

Is China’s manufacturing juggernaut operating out of street? Donald Trump’s return will pose one of many sternest checks but for the nation’s formidable export sector. As home demand suffers from a deep property droop, Beijing is below stress to rethink the financial system’s rising dependence on outbound commerce.

We’re additionally studying . . . 

• International chip battle: The race for semiconductor dominance has entered murky waters because the trade ponders tariffs and extra below Trump 2.0, writes Chris Miller, creator of Chip Struggle.

• ‘Chancellor of peace’: Because the battle in Ukraine drags on, Germany’s Olaf Scholz is making an attempt to paint his rivals as warmongers forward of a snap vote in February.

• Sick man of Europe? Knowledge reveals a story about Britain’s illness-related inactivity disaster appears fallacious or at finest overrated, writes John Burn-Murdoch.

• Rachel Reeves: In an op-ed for the FT, the UK chancellor explains how she goals to ship the federal government’s new “plan for change” by bringing enterprise innovation into Whitehall.

Chart of the day

Donald Trump, a self-described “Tariff Man”, will discover import taxes a slipshod and sometimes ineffective approach of asserting American energy, writes Alan Beattie. Fairly merely, the US simply isn’t that large in world commerce any extra.

The FT’s Ladies of 2024

From Charli XCX of “brat” fame to Europe’s former competitors commissioner Margrethe Vestager, we rejoice the ladies who’re remaking the world we dwell in in the present day. Learn FT Weekend’s listing of 25 of the world’s most influential girls, written by the world’s most influential girls.