Stock Markets Soar to Record Highs on Trump Election Victory 11/06/24

David Faber (0:00)

Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Carl Quintanilla (0:05)

Good Wednesday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer, David Faber at Post 9 of the New York Stock Exchange. Stocks looked open at all time highs as markets reprice across the board on Donald Trump's decisive and historic political comeback. The dollar and small caps are soaring, volatility collapses, even as control of the house still remains unknown. A roadmap begins with the stock surge following that historic election. Donald Trump becoming the first in over a century to win back the White House after losing it.

David Faber (0:33)

Plus, we're keeping an eye on Tesla shares because they're on a tear. Of course, Elon Musk was amongst Trump's biggest and most vocal backers, and investors are betting Tesla will benefit from his victory. Also on earnings watch, keep an eye on shares of CVS. They're rallying. The company does hold off on providing fourth quarter guidance. Meanwhile, shares of Super Micro. They're headed in the opposite direction, as it says it has no timetable for giving us its annual results.

Carl Quintanilla (1:01)

Let's, of course, begin with futures surging today after Donald Trump's stunning political comeback. NBC News projects he has been elected the 47th president of the United States, defeating Vice President Kamala Harris. Trump secured a second term after surpassing the 270 electoral votes needed for victory, and he's on track to win all seven battleground states in a race that many pollsters predicted would be neck and neck. Jim, I'm reminded of what George Bush once said about a midterm. This was a thumping.

Jim Cramer (1:29)

Yeah, this really was. This was what we used to call in political science a critical election, meaning that there's a watershed that changes pretty much everything. And means that it goes from, say, in this case, liberal to arch right wing. And I think that we should realize from our point of view that there are two markets, not one market. There's one market that we all know, which is the stock market, and that is screaming. The other market that is absolutely cratering is the bond market. The bond market is somewhat larger than the stock market, and we have to recognize that some of the prices we've seen could be undone by the bond market, as they would be, David, any other day of the week, for the last, say, I don't know, 100 years?

David Faber (2:12)

Yeah, certainly rates are going to be an important component of the tapestry that investors try to consider. And we'll see whether that treasury remains, yield remains elevated, of course.

Jim Cramer (2:24)

Not being talked about.

David Faber (2:26)

Well, we've talked about the possibility, certainly, of a Trump presidency, including significant tariffs, which might be inflationary. Although, again, much of this remains unclear because you don't know what you're going to get once he actually takes office. And taxes coming down, which conceivably will send the deficit higher, which will also potentially pressure yields and prices obviously coming down. So we'll see, but this is certainly a reaction, one that we've been seeing a bit in the bond market, certainly in the weeks prior to the election, as many anticipated a Trump potential Trump victory.

Jim Cramer (2:59)

The October thumping of the bonds may have been anticipating this. But to go back to what you're saying, Carl, when you have this kind of repudiation of a regime and the repudiation, the regime is regarded as overly regulated, as anti-business, as anti-growth.

And this administration is regarded as pro-growth, anti-regulation. And, frankly, all systems go for us. The problem is, as David just said, you can't pay for it. But as we had some great guesses that you did, can I just say you did an unbelievable job? And that you're here is so exciting for me. I mean, come on. I mean, he's here. And it's like...

David Faber (3:38)

Also, he looks great.

Carl Quintanilla (3:41)

As do you both.

Jim Cramer (3:42)

Nah, but I will say that we have to accept the fact that Richard Fisher, who's a great economist and also a great businessman, is saying at some point, we're going to have to pay the piper for the budget deficit. And I think there are probably some people who say, you know what, never going to happen. We're going to grow our way out of it, Trump. And then people look at the screen and say, oh my, where are they going?

David Faber (4:05)

That's where the House, and obviously Carl mentioned that at the top of the broadcast, the House becomes important, because if the Republicans maintain control of the House, you'd expect that he can move tax legislation pretty quickly, given the majorities in both the Senate and the House. And we may be getting answers on sort of the deficit and what that's going to look like.