The stock market has been on a tear, with the Dow Jones, S&P 500, and Nasdaq all hitting record highs following Donald Trump's presidential victory. Fueling the rally is a surge in Bitcoin, which has topped $80,000, as well as strong earnings from leading tech and growth stocks. Investors are betting on a tailwind under a second Trump administration, with the former president's pro-crypto stance and potential policies seen as a boon for the digital currency and related sectors.

Riding the Wave of Crypto and Market Optimism

Crypto Surge Leads the Charge

Bitcoin has been the star of the show, soaring past the $80,000 mark on Sunday amid a broader crypto run. The pioneer cryptocurrency was trading at $76,783.86 on Friday, but has since jumped 14.1% in just four sessions, starting with Election Day. This surge is being attributed to President-elect Trump's pro-crypto stance during his campaign, which is expected to usher in a more favorable regulatory environment for digital currencies.The weekend's Bitcoin move should extend the tailwind for Bitcoin ETFs and related stocks like Coinbase Global (COIN) and Robinhood Markets (HOOD). It also suggests a continued risk-on advance for financial markets broadly, as investors embrace the potential for a crypto-friendly administration.

Stocks Surge to Record Highs

The stock market rally has been nothing short of impressive, with the Dow Jones Industrial Average jumping 4.6%, the S&P 500 index popping 4.7%, and the Nasdaq composite leaping 5.7% in the past week – all hitting record highs. The small-cap Russell 2000 also spiked 8.6% to its best levels since its all-time high in November 2021.This broad-based rally is being fueled by hopes that a Trump return to the White House, backed by a GOP Congress, will mean tax cuts, deregulation, and increased merger activity. The Federal Reserve's continued rate cuts and dovish stance have also contributed to the market's bullish sentiment.

Standout Performers and Sector Strength

The market's gains were not limited to the major indexes, as dozens, if not hundreds, of individual stocks saw double-digit weekly gains. Tesla (TSLA) skyrocketed 29%, reclaiming a $1 trillion market cap, while Palantir Technologies (PLTR) had an even better week, surging 39%. Other notable winners include Axon Enterprise (AXON), which jumped nearly 42%.The strength was also evident across various sectors, with the Innovator IBD 50 ETF (FFTY) leaping 11.5%, the iShares Expanded Tech-Software Sector ETF (IGV) running up 9.7%, and the VanEck Vectors Semiconductor ETF (SMH) gaining 6%. The ARK Innovation ETF (ARKK) spiked 15.9%, and the ARK Genomics ETF (ARKG) bolted 7.9%, reflecting the continued investor appetite for growth and innovation.

Stocks Positioning for Further Gains

The market rally has also brought several leading stocks into buy range, offering opportunities for investors. Meta Platforms (META) and Google-parent Alphabet (GOOGL) are just below buy points, while CrowdStrike (CRWD), Vertex Pharmaceuticals (VRTX), and Nvidia (NVDA) are currently actionable.Nvidia, Meta, and Vertex are on IBD Leaderboard, with Tesla on the Leaderboard watchlist. Nvidia, Palantir, and Monday.com (MNDY) are on the IBD 50, and Google was Friday's IBD Stock Of The Day.As the market remains in a strong uptrend, investors should be cautious of potential pullbacks but also look to gradually build exposure to leading stocks that are not yet extended. Staying vigilant and closely monitoring the market's direction and individual stock setups will be crucial in navigating the current environment.