American voters will cast their votes this week to elect the next President of the United States, while the Federal Reserve will provide more official insights on the latest benchmark interest rates, the US economic outlook, and future rate paths at its November monetary policy meeting. In China, the 14th National People's Congress Standing Committee will convene its twelfth session from November 4th to 8th in Beijing, with the market generally expecting the meeting to review the issue of raising the government's debt ceiling and promote a new round of debt resolution work.

The week starting on November 4th may be a 'super heavyweight week' that will be pivotal on the global financial development stage. Three undoubtedly significant macro events could exert a decisive influence on global financial markets and the direction of global funds.

The globally anticipated result of the U.S. elections is about to be revealed.

Firstly, on November 5th, Eastern Time, is the U.S. Presidential Election Day, marking the climax of the electoral cycle. This period has attracted the attention of top Wall Street investment banks and triggered fluctuations in nearly every corner of the global financial markets.

As the world's largest economy, the election of the future leader of the United States will undoubtedly attract the attention of major global funds. However, the likely result of this U.S. presidential election may not be announced on the election day of November 5th or the following day but could require a few additional days.

In the previous election, due to the extremely close situation in the swing states, state officials took four days to count all the votes: from the end of voting on November 3rd until the complete vote count in Pennsylvania on November 7th, Biden formally declared victory in the presidential election.

Considering that Trump and Harris' polling support rates are increasingly closer compared to Biden and Trump in the 2020 elections, it may take longer to count the votes in some swing states this time.

The so-called 'Trump trade' mainly involves the appreciation of the US dollar and the selling of US treasuries, as well as $Bitcoin (BTC.CC)$The soaring prices, especially the surge in Bitcoin, are mainly due to Trump expressing support for the development of cryptocurrencies in the US multiple times. People hope that Trump will lift many regulations on the cryptocurrency industry.

"I will return like lightning." Trump's bold statement may soon become a reality. The 'Trump trade' has been booming recently, with data from betting markets tracking the US election showing that the likelihood of Trump winning has increased significantly to over 60%. The wave of the 'Trump trade' is once again sweeping the globe. The coverage of the 'Trump trade' is very wide, and there is a general consensus among Wall Street traders and strategists that Trump's reelection as president may lead to extremely loose fiscal policies and larger-scale trade protectionism. Therefore, driven by these two policy expectations, the exchange rates of the US dollar against multiple currencies have recently strengthened significantly, and the yields of US treasuries of various maturities have also risen sharply due to the 'Trump trade'.

Nevertheless, the two sides remain deadlocked in public opinion polls initiated by US media, with Harris recently even slightly overtaking Trump in a poll. Some investment institutions predict that regardless of the outcome, voting data will be accompanied by violent fluctuations in the financial markets.

"In either case, there seems to be some short-term risks." said Walter Todd, Chief Investment Officer at Greenwood Capital.

Todd stated that a Republican victory under Trump's leadership could be a 'news-driven' key trigger event, which may trigger a sharp profit-taking in the Trump trade. He also stated that Harris' electoral victory could lead to more severe sell-offs.

Citigroup's analysis team on Wall Street recently released a research report pointing out that the market has partially priced in the possibility of Trump's victory, indicating trades related to Trump.风险回报比It has deteriorated. Therefore, Citigroup believes that investors should take profits on some 'Trump-oriented' positions, especially those assets related to Trump policies and improvement in public opinion polls. Data shows that these assets have performed well since the release of the September non-farm payrolls report, but Citigroup believes that the current risk-return profile is no longer attractive.

The specific control of the US Congress will also be determined by the vote on Tuesday Eastern Time, which poses another challenge for investors as they weigh the various political outcomes' long-term impact on assets. The two candidates provide distinctly different paths for the US economy.

When Trump was elected President of the US, the performance of European stock markets relative to US stock markets was the worst among the past eight US governments. The performance of European stocks during the Trump administration period has important reference significance for the global stock market during the US election, especially for the stock markets of many Asian countries that rely on export economies.

If the Republican candidate defeats the Democratic candidate Kamala Harris, he is very likely to implement protectionist trade policies on industries in Europe that heavily rely on exports, which would then severely impact the European stock market, explaining why some investment institutions predict a repeat of the past for the European stock market.

For example, Trump seeking to reduce regulatory expectations is expected to significantly benefit bank stocks, while higher tariffs may benefit small companies focusing on the US domestic market, while also increasing the possibility of broader global market volatility.

In a stock research report released on Friday, JPMorgan's analyst team stated: "Overall, we expect the most important short-term results to be related to corporate tax rates, as the policy differences between the potential administrations in this regard are significant."

Neil Birrell, Chief Investment Officer at Premier Miton Investors, stated that news of Trump's potential victory has gradually been "digested" in Europe. He said: "People are moving away from stocks that performed poorly during Trump's previous term."

Wall Street analysts generally agree that Harris's expected greater support for clean energy initiatives implies that if she wins, solar and other renewable energy stocks may rise faster.

Investors are also concerned about the uncertainty of the election results, as intense competition or objections from either side may make it difficult to determine the results in the short term. In 2020, Trump attempted to overturn his loss to Joe Biden by falsely claiming voter fraud in multiple states.

Robert Pavlik, Senior Portfolio Manager at Dakota Wealth, said: "The market actually performed well during Trump's presidency. It can also perform well under Harris's leadership." "We just need to understand their policy directions."

After election day, the Federal Reserve interest rate decision will be announced.

The Federal Reserve will make a decision on monetary policy on Thursday, Eastern Time, which is crucial for this year.$S&P 500 Index (.SPX.US)$Another key risk factor for the bull market's approximately 20% increase. In the previous week, including$Microsoft (MSFT.US)$ as well as $Apple (AAPL.US)$ The performance reports of the American technology giants, including Apple, can be described as a mix of joys and sorrows, leading to a decline in the index in October after five consecutive months of gains, covering numerous technology stocks.$Nasdaq Composite Index (.IXIC.US)$After seven weeks of consecutive increases, there was also a decline in October.

Regarding the profit data on the numerator side of the DCF, leading tech giants with high weights in the S&P 500 and Nasdaq Composite Indexes have failed to provide strong enough profits and performance guidance to boost the numerator data of the DCF model. Therefore, the market is now eagerly awaiting the Federal Reserve to announce a rate cut and release dovish rate cut language to lower the expected risk-free rate in the denominator, thus continuing to drive U.S. stocks to new highs.

LSEG compilation data shows, federal funds.Futures Trading Commission (CFTC)'s latest data shows that investors are significantly reducing their net short positions in US soybean, corn, and wheat contracts, easing bearish sentiment in the market.According to pricing data, after announcing the first rate cut in four years in September, interest rate futures traders are betting that the Federal Reserve will slightly reduce the benchmark policy rate by 25 basis points this week, and traders are betting that the gradual rate cut pace of 25 basis points will continue in December.

For many investors, the focus will be on the interest rate path guidance provided by Federal Reserve Chairman Jerome Powell at the press conference, including whether, given strong economic data, the Federal Reserve will consider pausing its rate cut cycle at future meetings.

Regarding the "Citigroup Economic Surprise Index" that the market is focused on, which measures the performance between economic data and market expectations, it is currently at its highest level since April. Last week's statistics showed that the U.S. economy grew at a steady pace of 2.8% in the third quarter, and the Federal Reserve's favorite inflation indicator—core PCE inflation, excluding volatile components like food and energy, recorded the largest monthly increase since April in September, with core PCE's year-on-year increase slightly higher than economists' general expectations. These data can be seen as providing important evidence for the Federal Reserve to slow down its rate cuts significantly after unexpectedly cutting rates by 50 basis points last month.

Friday's monthly non-farm payrolls report is the final key data before the Fed rate meeting. It contradicts the trend indicated by the initial GDP values suggesting continued growth in the US economy, as it shows a near standstill in non-farm employment growth in October. However, strikes in the aviation industry and the sudden impact of hurricanes affected the response rate of wage surveys and specific statistical data, casting a shadow over the data. This has led some economists to emphasize that the Fed will not overly focus on this extremely distorted and weak data due to various noisy factors.non-farm payroll data.

Michael Feroli, an economist at JPMorgan, said in a report, "Recent economic data... suggest that the reasons for rate cuts are still valid." "Even if the election day is decided before Thursday, we still believe that there is enough uncertainty in monetary policy and economic prospects, so the Federal Reserve should be cautious in predicting interest rate paths and economic guidance."

"In October, the U.S. non-farm payroll data was weak, not only due to the hurricanes, but we also see signs of economic slowdown in some U.S. regions. We believe that this employment data will lead the Federal Reserve to announce a 25 basis point cut in interest rates in November and December, with a gradual rate cut being the theme for the foreseeable future." Bloomberg Economics economist Anna WONG and others said.

Famous journalist Nick Timiraos, known as the 'New Fed Communications Agency,' recently stated that Federal Reserve officials are expected to cut interest rates by 25 basis points at Thursday's monetary policy meeting.

However, Timiraos mentioned that Fed officials may still engage in a tricky debate in the coming months: "First, deciding at what level interest rates should stabilize. Second, although the election results will not affect this week's rate decision, any reshaping of economic prospects by future presidents and shifts in Congressional power could also alter the Fed's rate path."

The 14th session of the National People's Congress Standing Committee, which is being closely watched by global funds.

The 32nd Chairman's Meeting of the 14th National People's Congress Standing Committee was held in Beijing on the 25th. Chairman **** presided over the meeting. The meeting decided that the 12th meeting of the 14th National People's Congress Standing Committee will be held in Beijing from November 4th to 8th.

The Chairman's Meeting suggested that the 12th meeting of the 14th National People's Congress Standing Committee should review drafts of the Preschool Education Law, the Cultural Relics Protection Law Amendment, the Mineral Resources Law Amendment, the Energy Law, the Anti-Money Laundering Law Amendment, and the amendment to the Supervision Law of People's Congress Standing Committees at all levels, and more.

The agenda for the 12th meeting of the Standing Committee suggested by the Chairman's Meeting also includes: reviewing the State Council's report on financial work, the comprehensive report on the management of state-owned assets in 2023, and the special report on the management of administrative and public sector state-owned assets in 2023.

The upcoming NPC Standing Committee meeting is highly anticipated. Prior to this meeting, the Ministry of Finance had announced during a press conference that it will introduce a package of incremental policies, including a plan to replace a large scale of local government outstanding implicit debts with a one-time significant increase in the debt ceiling, intensifying support to help local areas resolve debt risks. The related policies will be comprehensively explained to the public after completing the legal procedures.

Following the Ministry of Finance's announcement of the plan to replace a large scale of local government outstanding implicit debts with a one-time significant increase in the debt ceiling, many localities are actively seeking this implicit debt replacement quota to alleviate the pressure of local government debt risk resolution.

However, increasing the debt ceiling requires approval from the National People’s Congress Standing Committee. It is expected by the public that the relevant matters will be announced at the 12th meeting of the 14th National People's Congress Standing Committee to be held from November 4th to 8th.

For the recently highly popular "overseas-listed Chinese asset ETFs," they will have unparalleled influence. These ETFs have been extremely attractive to foreign funds recently, making them the best entry point for foreign institutional investments in Chinese listed companies.

The hot ETFs focused on Chinese assets listed on the NYSE$iShares China Large-Cap ETF (FXI.US)$ , with a total size exceeding 10 billion US dollars in October, highlighting the continuous surge in foreign funds' enthusiasm for Chinese assets, especially for Hong Kong stocks. This ETF has seen a value increase of up to 32% year-to-date, outperforming even the S&P 500 Index.

$iShares China Large-Cap ETF (FXI.US)$ 全面聚焦于港股市场，为国际投资者们提供投资于中国最顶级上市公司的主要途径，该ETF覆盖港股市场上市值规模最大、流动性最好的50只股票。

Jeff deGraaf, the seasoned market strategist on Wall Street and co-founder and CEO of the top investment firm Renaissance Macro Research, recently predicted in an interview that one of the key A-share indexes, the CSI 300 Index, may surge by 50% within 12 months, challenging the 6000-point mark. 'Doubt dissipates, valuation advantages, massive stimulus, momentum, and trend changes. All these factors are present there,' he emphasized in the interview. 'This is one of the best lineups I have seen in my 35-year career.'

这位华尔街老兵给出的$CSI 300 Index (000300.SH)$指数预期，甚至远高于有着“全球股市牛市旗手”称号的华尔街金融巨头高盛给出的4600点位，也高于另一华尔街巨头花旗给出的4900点。

有着“全球股市牛市旗手”称号的华尔街金融巨头高盛10月发表看涨研报称，上调中国股市(包含港股与A股)评级至“超配”，并且将$CSI 300 Index (399300.SZ)$指数的目标点位从4000提高到4600。高盛还将涵盖涵盖$Alibaba (BABA.US)$and$TENCENT (00700.HK)$ and$Kweichow Moutai (600519.SH)$The target level of the MSCI Chinese Index for core assets in China has been raised from 66 to 84, whereas the latest closing level of the MSCI China Index is at 66.7 points. In terms of industry allocation, Goldman Sachs states that due to increased capital market activity and improved asset performance, insurance and other financial sectors (such as brokerages, exchanges, and investment institutions) have been adjusted to 'overweight'; at the same time, Goldman Sachs maintains an 'overweight' position on China's internet and entertainment, technology hardware and semiconductors, consumer retail and services, as well as daily necessities industries.

Editor/Rocky