Week 3 Wrap: Trump 2.0 kicks off next week (where is RFK?); US CPI reassures markets; Israel-Hamas ceasefire and the Red Sea

It will be a most interesting day to wake up on the 22nd in Australia. We will either wake up to a world where the President of the United States has begun arresting journalists, Democratic politicians and other anti-Trump advocates – or a world where he hasn’t.

That two-sided coin will likely inform market sentiment towards the second Trump administration more than anything else: whether or not the man acts on his long-espoused promises of “revenge.”

Don’t forget that Trump said during his most recent election campaign his first day back in power would be about payback, joking he would be a dictator for one day.

It sounds easy to dismiss. But don’t forget the US has already, in essence, banned abortion across great swathes of its territory. (Not long ago, free access to abortion would have been touted as proof of a progressive Western world.)

US health stocks could be entertaining

But if one wants to zoom in, another interesting sector to watch will be the healthcare and biotech space. Remember Democrat-cum-Republican Robert F. Kennedy was appointed to effectively lead the US health regulatory system? The anti-vaxxer could shake up the scene for large pharmaceutical companies and their stock prices.

Speaking of RFK, actually – where the hell is he? One note: the FDA banned a popular red food dye this week. Time will tell.

At any rate, outside of politics, the US economy appears to be back on track getting disinflation embedded with the latest core CPI read being more than favourable to markets, helping to push the ASX200 back above the 8,300 level it’s been orbiting since late last year.

Israel-Hamas ceasefire? Yeah right

A six week ceasefire between Israel and Hamas was struck this week, despite falling apart at one point before then being agreed upon again. That kind of volatility is what leads me, personally, to call bullshit on the whole thing.

Probably most important to realise is that the ceasefire only runs for six weeks when it is meant to kick off this Sunday, but as the agreement has been drawn up and negotiated, Israel has still been busy bombing Gaza.

Some 30 Israeli hostages are set to be released though it isn’t known if that will be staged, or all at once. Both Israel and Hamas declared victory.

Again, though: Israeli rockets continue to smash Gaza. And what happens after six weeks? The same old thing, given Israel has just radicalised an entire generation, guaranteeing another October 7 down the line.

This also brings up another interesting question: what the hell happens, now, with the Red Sea? It’s only been less than 48 hours, but Maersk has already said it has no plans to immediately return.

An analysis of Marine Traffic data on Friday showed heavy shipping flows around Africa’s Cape Horn, a more expensive route in use ever since the Houthis began firing at ships perceived to be tied to Israel (or even the West broadly.)

For now, the Suez Canal remains unused by ships with white-sounding names. Easiest way to put it.

Have a great weekend and see you next week.