Market Climbs, Crypto Falls: Big Tech's Role and Trump's Impact

As the new year begins, the market has seen a surge in traditional stocks, while the crypto market has experienced a significant decline. Meanwhile, Big Tech companies continue to dominate, and President Donald Trump has started signing executive orders, which could have far-reaching implications for various sectors. Let's dive into these market dynamics and explore the opportunities and risks they present for investors.



Traditional Markets' Climb

The tech sector has been a standout performer, with the S&P 500 Information Technology Index leading the market in 2024. This is driven by strong results from semiconductor companies, which are key players in the AI infrastructure space. The "magnificent seven" stocks—Apple, Microsoft, Amazon, Alphabet (Google), Tesla, Nvidia, and Meta Platforms—have driven a large portion of the market's returns in 2023 and 2024. The semiconductor industry is expected to see attractive potential in 2025, with non-AI-winner chip makers poised to benefit from an AI-driven product-upgrade cycle and a potential lift to the general economic environment.



Crypto Market's Fall

The crypto market experienced a major crash on December 9, 2024, with Bitcoin dropping from $101,109 to as low as $94,150, marking a -7% decline. Altcoins suffered significantly more severe losses, with Ethereum falling by as much as -12%. Over 562,000 traders were liquidated in the past 24 hours, and total liquidations reached $1.7 billion. The largest single liquidation order took place on Binance in the ETHUSDT pair, valued at $19.69 million. The crypto market decline was driven by increased selling pressure on Coinbase, which pushed prices into zones where overleveraged traders had little choice but to unwind.



Big Tech's Role

The "magnificent seven" stocks have significantly influenced the broader market trends in recent years. These companies have driven a large portion of the market's returns in 2023 and 2024, contributing to the tech sector's strong performance. In 2025 and beyond, the sector is still well positioned, with the impacts of generative AI and increased digitization and automation of our lives continuing to drive results for the semiconductor makers, software makers, and other companies that populate this sector.



Trump's Impact

With Donald Trump starting his presidency and signing executive orders, his policies and actions are likely to have a significant impact on the market. Certain sectors and industries are likely to be more impacted than others. For instance, Trump's policies are expected to be favorable to the energy sector, particularly the oil and gas industry. His administration is likely to support increased domestic production, reduce regulations, and promote infrastructure development. This could lead to positive market reactions for companies in this sector, such as those listed under "Oil and Gas Drilling," "Oil and Gas Services," and "Oil and Gas Refining and Marketing." Additionally, Trump's focus on infrastructure development and economic growth could have a positive impact on the real estate sector, including both residential and commercial real estate, as well as real estate investment trusts (REITs).



In conclusion, the recent market dynamics, particularly the climb in traditional markets and the fall in crypto, have significantly impacted the overall investment landscape, presenting both opportunities and risks for investors. The presence of Big Tech companies in the market has significantly influenced broader market trends, and they play a crucial role in shaping future market movements. Trump's policies and actions are likely to have a significant impact on the market, with certain sectors and industries being more impacted than others. Investors should carefully consider these opportunities and risks when making investment decisions, and maintain a diversified portfolio to mitigate potential losses.