IN THIS ISSUE:
1. Markets Surge Post-Election as Clarity Spurs Investor Optimism
2. Inflation Picks Up, Strengthening Expectations for December Fed Rate Cut
3. Impactathon Inspires Soka Students to Pitch Bold Ideas for a Better Future
Market Update
Markets Surge Post-Election as Clarity Spurs Investor Optimism
U.S. markets rallied in the wake of a decisive Republican victory, with the S&P 500 climbing 2.5% in the days following the election. The outcome, which secured the presidency and Senate for the GOP while leaving the House likely to lean Republican, has removed a significant layer of uncertainty for investors.
Historically, markets tend to respond positively to clear electoral outcomes, and this year is proving no different. Equity and bond market volatility, elevated in the weeks leading up to the vote, quickly subsided as the results solidified. The financial sector led the charge, fueled by expectations of deregulation and tax cuts that could benefit regional banks and cyclical industries.
On Wall Street, the mood is optimistic. One junior banker noted a likely surge in mergers and acquisitions, and a senior executive highlighted that the anticipated deal flow increase stems not from the victory of a particular party but from a broader reduction in uncertainty. With markets relieved, the stage appears set for an uptick in mergers and acquisitions and financing activity. Still, some caution is warranted. While initial market gains are often strong, they tend to moderate over time.
Data: finance.google.com
Economy
Inflation Picks Up, Strengthening Expectations for December Fed Rate Cut
According to recent reporting, inflation pressures remained firm in the month of October, as the Consumer Price Index (CPI) rose 2.6% year-over-year, up from 2.4% in September, signaling persistent price growth. The latest inflation data has bolstered market expectations that the Federal Reserve will move forward with a rate cut in December to support the economy amid slowing growth.
The report by the Department of Labor Statistics highlights a 3.3% increase in core prices, excluding volatile food and energy categories. Notable gains were observed in sectors such as used vehicles, up 2.7%, and airline fares, which climbed 3.2%, while energy prices stayed relatively flat. Despite these gains, the Fed maintains its view that inflation is moderating overall, although certain price pressures remain sticky from earlier hikes.
This renewed uptick in inflation has sparked confidence in the Fed’s strategy to cut rates cautiously without reigniting runaway inflation. However, some officials within the central bank remain hesitant about moving too aggressively. Concerns linger that cutting rates too quickly or too deeply could lead to long-term challenges, such as a need for sudden reversals if inflation accelerates unexpectedly.
The Fed’s current goal is to reach a target 2% inflation rate—one that neither overstimulates nor restricts economic growth. Yet, policymakers aim to avoid policy missteps that could destabilize the economy. As the December meeting approaches, all eyes will be on the Fed’s next move and its broader strategy for navigating a challenging economic landscape.
Special from Bridges to Business
Impactathon Inspires Soka Students to Pitch Bold Ideas for a Better Future
Impactathon (26), in collaboration with Bridges to Business, brought together five student teams to pitch social enterprise concepts to a panel of judges on November 1-3. While the election was shaping the future of deals and policies in the next 4 years, Soka students focused on building projects aimed at shaping the long-term future of the world.
The three-day Impactathon featured, including insights on founding ventures, advice on raising funds, and team-building activities focused on social enterprise development. After gaining insights from investors at Unshackled Ventures, a VC firm, participants joined a series of workshops to refine their ideas and hone their presentation skills. The event culminated in a pitch day, judged by senior professionals from across Orange County.
With over 40 participants, the challenge might seem simple but certainly not easy: develop a viable business model and deliver a compelling pitch—all within 48 hours. The teams sought to build solutions to democratize access to education and mental health, resources for international students, safety for women walking alone at night, and plastic recycling in Ghana.
Since its first competition at SUA in 2018, Impactathon has become a platform for innovation and collaboration. This month’s event was no exception, showcasing the students’ dedication and creativity. Innov8social, the organization behind Impactathon, praised the participants for their efforts: “Participants showed up with courage, tenacity, passion, and willingness to dive into understanding problems, proposing solutions, and iterating with feedback,” noted Neetal Parekh, founder of Innov8social.
Soka Business Review is created in collaboration between Bridges to Business and Soka Finance Society. Uget Hagan (‘28) contributed to the Impactathon column.
