November 12, 2024
Markets and the Fed
U.S. markets rallied after Donald Trump's re-election, with major indexes hitting new highs and the dollar posting its largest surge in eight years. Bitcoin also reached a record high as investors expected a more favorable crypto regulatory environment.
The Fed cut rates by 25 basis points, bringing the federal funds range to 4.5% to 4.75%. Chair Jerome Powell called the move a policy recalibration, while still pointing to inflation risk and a resilient labor market. For recruiting, the useful point is that lower rates can lift valuation multiples, but tariffs and tax cuts may also keep inflation expectations alive.
October payrolls rose by only 12,000, the smallest monthly gain since December 2020. The number was distorted by the Boeing strike and hurricanes Helene and Milton. The strike alone subtracted an estimated 44,000 manufacturing jobs, and August and September job creation were revised lower by 112,000.
Boeing and Tesla
Boeing machinists voted to end an almost eight-week strike, approving a contract with a 38% wage increase and a $12,000 ratification bonus. The deal received support from 59% of union members and allows Boeing to restart manufacturing.
The restart does not remove the cash-flow problem. Boeing had cut 17,000 jobs, raised more than $24 billion in equity, and burned about $10 billion in cash through the first nine months of the year. Management also warned that cash flow would likely remain negative in 2025. This is the kind of company update that works well in interviews because it links labor, margin pressure, liquidity, and supply-chain recovery.
Tesla shares rose more than 14% after the election. Investors appeared to price in a policy backdrop that could hurt smaller EV makers more than Tesla if clean-energy subsidies are reduced. Tesla had roughly 48.9% U.S. EV market share in 2024, while Nio, Rivian, and Lucid declined during the same period. Potential tariffs on Chinese imports could also limit lower-priced EV competition in the U.S.
Power and global data
FERC denied Talen Energy's proposal to increase nuclear power supplied from its Susquehanna plant to an Amazon data center from 300 megawatts to 480 megawatts. Talen fell 2%, and other nuclear-linked power names including Constellation and Vistra also slipped. The ruling shows that AI infrastructure is not just about chips. Power contracts, transmission costs, and grid reliability can shape the pace of data center growth.
Global data were mixed. South Korea's export growth slowed to 4.6% year over year in October from 7.5% in September, though semiconductor exports rose 40.3%. Germany's new manufacturing orders rose 4.2% in September, helped by aircraft, ships, military vehicles, and a 2.9% increase in auto orders. Brazil moved against the Fed by raising its benchmark rate 0.5 percentage points to 11.25%, as inflation and a real down more than 14% for the year kept pressure on policymakers.