Scott Bessent, founder and chief executive officer of Key Square Group LP, during an interview in Washington, DC, US, on Friday, June 7, 2024.
This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Markets rally
U.S. stocks saw a broad rally on Monday with major indexes hitting record highs. The pan-European Stoxx 600 closed near the flatline. UniCredit, an Italian bank, offered to buy its domestic rival Banco BPM for roughly 10 billion euros ($10.5 billion). UniCredit has also been eyeing German lender Commerzbank.
Wall Street likes Bessent
Scott Bessent, President-elect Donald Trump's pick for U.S. Treasury secretary, has got a big thumbs up from the stock as well as bond markets. Wall Street strategists heaped praise on Bessent; global analysts also think Trump's pick is favorable for markets.
Intel's close to clinching deals
The U.S. CHIPS and Science Act office is nearing a deal with Intel, which would award the chipmaker with a grant worth around $8.5 billion, according to a source close to the matter. The Department of Defense is also poised to award Intel a $3 billion contract to manufacture chips. Those are some bright spots in Intel's difficult year.
Bitcoin struggles to break barrier
After hovering near the $100,000 mark, bitcoin lost some momentum and has dropped to $94,228.47, according to Coin Metrics. Investors are likely taking profit, said Andre Dragosch, head of research for Europe at Bitwise. There's also "a ton of leverage in the system," Mark Novogratz, CEO of digital asset management firm Galaxy Digital, told CNBC.
[PRO] How to invest $500,000 in 2025
In 2025, Trump, with his policies that promise to shake up the economy, will be in the White House; the U.S. Federal Reserve will continue tweaking rates; and Nvidia will be delivering its next-generation Blackwell chips. CNBC Pro spoke with wealth managers to find out how investors should invest $500,000 in the rocky year ahead.
Money Report
The bottom line
The Trump rally appears to be shifting into high gear.
This time, it's revved up by Trump's Treasury secretary pick — Scott Bessent. Investors like Bessent because, as the founder of hedge fund Key Square Group, he brings to the job an understanding of Wall Street and is presumably supportive of markets.
Moreover, Bessent has expressed that he prioritizes controlling inflation even amid policies designed to support domestic growth. "I would recommend that tariffs be layered in gradually," Bessent told CNBC earlier this month before his nomination.
Unlike earlier Trump rallies, in which particular assets linked to Trump's policies — bank stocks, small-cap stocks and bitcoin — reaped disproportionate gains, yesterday's rise in markets was broad.
The S&P 500 rose 0.3%, in a move that saw more than 3 of 4 stocks in the index trading higher. The Dow Jones Industrial Average climbed 0.99%, extending its string of record highs, and the Nasdaq Composite added 0.27%.
It wasn't just large-caps that were lifted by Bessent's nomination. Small-cap stocks performed even better, probably because Bessent has expressed support for Trump's economic agenda, which would benefit smaller, domestically oriented companies. The Russell 2000 index of small- and mid-caps gained 1.47%, its sixth positive session in a row. It closed at a new high, exceeding its record set in 2021.
The bond market also reacted positively to the news. Yield on the 10-year Treasury fell more than 14 basis points.
"You can't ask for a better reception from the market," said Quincy Krosby, chief global strategist at LPL Financial. "This is the market applauding."
U.S. markets will be closed on Thursday for Thanksgiving. Bessent might be one of the things for which investors will be grateful.
— CNBC's Alex Harring and Hakyung Kim contributed to this report.
