The US stock market is poised to open at record highs on Veterans Day, fueled by a post-election rally and expectations of lower corporate taxes and deregulation under the incoming administration. Investors are eagerly awaiting the latest inflation data, which could provide clues about the Federal Reserve's future rate decisions. Meanwhile, the cryptocurrency market is also experiencing a surge, with Bitcoin and other digital currencies climbing as traders anticipate a crypto-friendly approach from the new government.

Unleashing the Power of Optimism: Investors Embrace the Post-Election Rally

Dow Leads the Charge, S&P and Nasdaq Follow Suit

The Dow Jones Industrial Average futures (YM=F) are leading the charge, climbing approximately 0.4%, while the S&P 500 futures (ES=F) and Nasdaq 100 futures (NQ=F) are also moving up, by 0.3% and 0.3% respectively. This comes on the heels of the best week of the year for both the Dow and the S&P 500, with both indexes reaching new all-time highs.The driving force behind this rally is the anticipation of lower corporate taxes and deregulation under the incoming administration. Investors are betting on a more business-friendly environment, which could translate into increased profitability and growth for companies across various sectors.

Inflation Data: The Key to the Fed's Next Move

Wall Street is eagerly awaiting the release of the October consumer inflation data on Wednesday, as it could provide crucial insights into the path of interest rates. Last week, Federal Reserve Chair Jerome Powell remained tight-lipped on the central bank's thinking, leaving the market to speculate on the potential impact of the new administration's policies on inflation.One concern is that the proposed tariffs by the incoming administration could lead to higher inflation, prompting the Fed to scale back on its rate cuts. Minneapolis Fed President Neel Kashkari warned that if there is an escalating "tit-for-tat" reaction by other countries, policymakers will "have to wait and see" how to respond.

Shifting Expectations: The Fed's Rate Cut Outlook

The market's expectations for the Fed's future rate decisions have shifted in the wake of the presidential election. Traders now see a 68% chance that the central bank will lower rates by another quarter percentage point in December, down from the nearly 80% odds a week ago, before the election.This change in sentiment reflects the uncertainty surrounding the new administration's policies and their potential impact on inflation. Investors are closely monitoring the situation, as the Fed's actions could have far-reaching consequences for the broader economy.

Tesla Soars, Crypto Surges: The "Trump Trade" Gains Momentum

The post-election rally is not limited to the traditional stock market. Tesla (TSLA) shares, considered a "Trump trade" hot spot, have continued to climb, rising nearly 7% in premarket trading. The electric vehicle maker's stock hit its highest close in over two years on Friday, topping $1 trillion in market value, as investors express optimism over CEO Elon Musk's relationship with the incoming president.The cryptocurrency market is also experiencing a surge, with Bitcoin (BTC-USD) soaring to top $82,000 for the first time. Dogecoin (DOGE-USD) and other smaller digital currencies have also climbed, as traders bet on a crypto-friendly approach from the new administration and Congress.This newfound enthusiasm in the crypto space reflects the market's belief that the incoming government will be more receptive to the growth and development of digital currencies, potentially paving the way for increased adoption and mainstream acceptance.