Senior Relationship Manager
Summary: Sell in May and go away?
Good Morning,
It was not a good month end on Friday, S&P 500 -3.63%, Nasdaq -4.17%, Dow -2.77%. Amazon ended the day 14% lower, Apple lost 3.7% and most of the heatmap was red. Facebook, Twitter and Tesla the big exceptions. The S&P 500 has lost four consecutive weeks and is down 13.3% in the year, the Nasdaq Composite fell 13% only in April.
Gold and Silver came under pressure and are currently trading 22.60 and 1883 and oil is a little lower over the weekend
EURUSD is at 1.0510 and GBPUSD 1.2550. it is a holiday in the UK due to May day being Sunday.
This week will be extremely busy with economic data and earnings. So far the earnings season has been strong on paper with 80% of companies beating expectations but the fact that heavyweights such as Amazon miss are pulling the market lower. Uncertain outlooks such as the one by apple add to the worries.
This weeks highlights ill be Blackrock today,
Tomorrow: BP, AMD, Pfizer, Airbnb
Wednesday: Moderna, Uber, Etsy,
Thursday: Shopify
In terms of economic Data, the highlights will be FOMC decision on Wednesday, the Bank of England on Thursday and the Nonfarm Payroll on Friday, Today we had the German retail sales at 8 lower than expected, PMIs and EU Economic sentiment.
From a technical point of view by our Kim Cramer, all major indexes are down trends on short, medium term and longer term i.e. on Daily, Weekly and Monthly basis, the S&P 500 closed below key support at 4,164. Down trend confirmed. No strong support before around 3,815. Minor support around 4,056, the Dax is in a short term down trend. A daily close below 13, 566 will lead to test of March low at 12,438.
Besides earnings and the economic data mentioned, the situation in China remains worrying where the corona measures are not being eased and will likely cause supply chain issues. The War in Ukraine and sanctions will continue to be in the spotlight.
Trade safely and consider optionality for any sizeable positions.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.