Markets await Trump’s return to the White House, bitcoin hits new record high, Reach upgrades guidance and Pod Point cash drains away

“Markets are beating to the drum of Donald Trump on the day of his return to the White House,” says Russ Mould, Investment Director at AJ Bell.

“Wall Street is preparing itself for the big event with futures prices implying a tick-up for the S&P and Nasdaq indices when US markets open later on. Oil prices are holding firm and bitcoin has surged to a new record high ahead of the crypto champion returning to power. Trump has also got his wish for a weaker dollar as the currency slips back.

“It’s a tick in every box for the incoming president but whether this remains the case in the coming months is a big unknown.

“Markets are eagerly awaiting Trump’s first batch of executive orders as this will provide clarity on the lay of the land. Immigration, energy and trade will be high up the list and, as always, the devil will be in the detail. Trump has had a lot to say on these issues but he also has a reputation of not always following what he’s promised to do to the letter.

“Markets want to know which countries and industry sectors will be targeted and the relevant tariff rates to price in any risks or opportunities to equities, currencies and bonds around the world.

“Trump is likely to have a much greater influence on markets than Joe Biden due to his punchier policies and unpredictable nature. Investors should strap themselves in, as this situation implies much greater swings up and down for share prices, currencies and other asset classes.

“Pending more information on how Trump plans to achieve policy goals, certain investors have focused on the here and now, and that’s a world in which the new president embraces cryptocurrencies. Bitcoin has gone bananas after Trump launched his own cryptocurrency on Friday. It’s got crypto fans fired up in hope that digital currencies will go mainstream.”

Reach

“Investors treated the pension black hole in Reach’s latest trading update like a sidebar in one of its titles and focused instead on the headline of better-than-expected performance in the final three months of 2024.

“The publisher of the Daily Mirror and Daily Express has faced the difficult task of trying to get newspapers to work commercially in the 21st century. Years ago, print titles could count on plenty of advertising revenue to help fund their activities, but that is no longer the case.

“As well as pushing its digital strategy, Reach has been stripping out costs at will. The issue with this strategy is the diminished quality of the product, which in turn makes it a less attractive venue for advertisers, whether online or in print. The market will want to see evidence of how the recent changes in the Budget might affect the company’s staffing cost base.

“The pension issue is clearly one the market is relaxed about for now; however, it is a reminder of the legacy issues the company has to contend with.”

Pod Point

“Never mind a speed bump, the latest shift in Pod Point’s trajectory feels more like a blown tyre in a pothole as the slower pace of electric vehicle roll-out has stymied its ambitions.

“A roll-out of at-home electric charging requires an expansion in the number of electric vehicles on the road. After all, people will only get this kit installed if they’re confident they are going to be bringing an EV home in the near term.

“However, a combination of factors like range anxiety, pressures on consumer spending and cost have acted as a roadblock to the adoption of EVs at the levels which Pod Point was counting on when it joined the market in 2021.

“The shares are trading at just a fraction of their listing price and the cash buffer the company has long enjoyed is being eroded. This is partly a result of the shift from home charging, where Pod Point gets paid upfront, to charging points in other locations.

“The problem for the company is that the point at which it becomes cash flow positive is moving further into the distance and, like a motorist whose fuel or charge is becoming depleted, this is more uncomfortable when the company’s money in the bank is draining away.”

These articles are for information purposes only and are not a personal recommendation or advice.