Trump 2.0 Rally is Only Just Starting
The equity seas are shifting.
A new wave of leadership has gripped the market.
The Trump 2.0 rally is only just starting.
Most would agree, it’s an exciting time to be an investor. Forgotten sleeper stocks, like PayPal (PYPL), Shopify (SHOP), Carvana (CVNA) and Palantir (PLTR) have suddenly sprung to life recently (Disclosure: I own PYPL).
These once high-flyers are benefiting from the latest tectonic shift: the Trump 2.0 red wave.
Last week, I touched on why a Republican controlled Oval Office and Congress is the best political scenario for markets. Historically, this situation spells market beating gains of 12.9% for the S&P 500.
That’s not bad if you ask me.
But there’s a much bigger opportunity in front of investors…and I mean huge opportunity.
Betting on smaller domestically focused equities is setting up for a crowd-stunning performance in 2025.
Now, I could easily ascribe my allegiance to small and mid-caps, echoing the mainstream media’s fascination with potential lower taxation, de-regulation, and infrastructure buildout.
Those talking points are well-covered and amount to guesses at this point…so I’ll pass.
Instead, I’ll give you undisputed evidence-rich insights pointing to this breakneck rally only beginning.
The fact is this. We’re witnessing one of the largest institutional risk-on signals ever. And when this level of institutional sponsorship happened in the past, what came next was so epic, that even the most evangelical bulls were stunned.
Let’s now review the latest market gyrations through our Big Money lens.
Trump 2.0 Rally is Only Just Starting
Since the vote on November 5th, all major market indices have surged.
Cyclical and growth-heavy baskets like the S&P Small Cap 600 and Russell 2000 are up 4.99% and 4.8% respectively, easily outpacing the larger S&P 500’s jump of 3.5%:
But these popular benchmarks fail to reveal what’s really transpiring. When you dive below the surface, powerful rarely seen risk-on behavior is noted.
The day after the election, we saw the 5th largest buy day since 2009.
486 discrete equities were accumulated:
This is the Trump 2.0 trade. We sent out a timely MAP PRO update the following morning giving clues as to what this means going forward with 4 unique data-points suggesting certain areas are set to surge.
To reinforce that message today, I’m going to breakdown additional insights about the chunky inflows from November 6th.
After reviewing it, you’ll want to hug your bearish buddies because they’ll need it.
Small-caps specifically, as expressed by the Russell 2000, gained 5.84% on November 6th – effectively signaling a bazooka-thrust day.
If you recall, back in July RTY ripped 3.5%, and we made the case that this is wildly bullish going forward.
Hold on to your hats because a 5%+ gain is not only rarer, it’s one of the most powerful green signals you’ll find.
A gain of 5% or more for the Russell 2000 has only occurred 33 times. Here’s why this is an important signal.
Whenever the Russell 2000 jumps 5%+ here’s what happens next:
- 6-months later small-caps climb 16.2%
- 12-months after you’re looking at 40.8% returns
- Even more impressive is the 24-month average rip of 57.6%
And to make this image more impactful, I’ve included and updated the 3.5% thrust signal to compare.
This data further suggests the Trump 2.0 rally is only just starting:
Normally this is enough to end today’s message on. But I’m going to do my bullish friends a favor.
There was another equally important data-point from the November voting day.
One of my other favorite themes, mid-caps, saw a breath-taking rally as well. On November 6th, 2024 the S&P Mid Cap 400 gained 4.15%.
Back to 1991, a 4%+ session has only happened 55 times. If you’re compelled to lock-in profits, hold that thought until you review the following.
When the S&P Mid Cap 400 climbs at least 4% here’s what follows:
- 6-months later mid-caps climb 13.4%
- 12-months after they ramp 34.4%
- Be bold for 24-months and you’re staring at 54.2% gains
Folks, last week I showed you why the last Trump victory staged a breath-taking rally for SMID caps right out of the gate.
This week, I’m telling you what worked then…is working NOW.
A prime example is Palantir Technologies (PLTR). Below on the left, notes the MAPsignals inflow days. Then on the right details only when those inflow days amounted to a Top 20 signal – meaning it’s one of our highest ranked stocks in our universe.
Palantir is just one example of the power of following hidden money flow signals.
It speaks to the fact that investors are now willing to wager on growth stocks again…especially the ones that were looked over the past few years as the crowd chased a handful of mega-cap names.
There’s a sea change upon us.
Trump 2.0 is a rebirth for prior leaders.
You just need a map to see them.
Here’s the bottom line: The mega rotation highlighted this summer is getting reinforced by the Trump 2.0 victory.
Smaller left behind stocks are attracting incredible amounts of capital. In fact, November 6th’s rally in the Russell 2000 and S&P Mid Cap 400 tend to forecast massive gains going forward.
One way to play that theme is with a broad-based ETF…but you can do better.
A lot better…
Specific high-quality small and mid-cap stocks are getting accumulated day after day…week after week…as investors digest the new administration.
MAPsignals is a great way to spot the new portfolio leadership…and latch on to the biggest trade of the year.
If you’re a serious investor, money manager, or Registered Investment Advisor (RIA) looking to take your research to the next level and find all-star stocks not on the lips of the media, get going with a MAP PRO subscription and follow the Big Money.
***Lastly, co-founder Jason Bodner is presenting The Massive Small Cap Opportunity and Which Five Stocks to Own at the MoneyShow Masters Symposium in Sarasota, FL. If you want to learn how we use our unique data lens to uncover the biggest market moves and outlier stocks – join him LIVE Thursday, December 5, 2024, 3:30 pm – 4:15 pm.
Register by Nov 21st as my guest and save 20%. Just click the image below – see you there!
