Balancing Act: Understanding Current Market Trends and Porfolio Moves
April 1, 2024 Update
Let’s start with the Nasdaq which was -0.3% for the week:
The index has been underperforming the SP500 for about 2 weeks now.
So the market is moving a bit away from technology towards other sectors.
Looking at liquidity, the M2 data for February is out and there’s been more contraction, which speaks to the “higher rates for longer” narrative:
On the other hand, we have a bit of discrepancy in the price of oil (up 1.86% for the week) and the 10-year treasury yield (down -0.28% for the week).
My take on the Macro:
the economy is sending signs of acceleration, with the last GDP estimations for Q1 slightly up;
oil prices look “bullish”;
inflation expectations are picking up slightly too;
rates cuts could come way later this year;
we are walking on a thin line where too much acceleration on the inflation side and then in rates could cause a correction;
the ideal situation would be to see an economy that stays strong enough and inflation that remains mute
Sectors, Industries, and Themes
In this environment Financials, Industrials and Materials are doing well, on top of Technology which is taking a break and remains a strong sector. Energy has been particularly strong over the last 3 months now.
Looking at specific Industries, Nonferrous metals (Gold) have been doing well. In the US there has been lots of government spending which is reflected in construction and industrials performance over the past 6 months, as shown below.
Theme-wise, Marijuana stocks keep doing well. Last week I bought into $MAPS, a software company specializing in that industry.
PORTFOLIOS
MY 2024 7 PICKS
At the end of March, my 7 picks are delivering 17.8% vs. 10.4% delivered by the SP500 so far. 4 winners out of 7 picks so far. Let’s see how it goes till the end of the year.
I think NVDA is too expensive here, APP might bring more upside, Zeta is very volatile and yet has room to keep going up, EverCommerce and Janus had not brilliant quarters and, even if they are profitable and undervalued, the market needs to see better growth numbers moving forward. Semler was disappointed in their last Earnings report too. Last, Bumble appointed a new CEO: the company is financially sound and undervalued, and concerns are about its ability to grow in a competitive space.
10X LARGE CAP MOMENTUM (Link to full portfolio)
I officially closed my 1st year with this portfolio at a whopping +97%
The portfolio is updated with my last addition of DNKG and SQSP.
This week I am adding a bit of energy to my portfolio by buying 22 shares of $CHRD if it touches 179 USD
If triggered, my first stop loss is 157 USD (-12%)
10X SMALL CAP PORTFOLIO (link to full portfolio)
Some action last week. Here is the updated look:
This week I am buying 330 shares of $CMPO if it touches 7.25 USD. First-stop loss at 5.9 USD (-18%)
That’s all for the week!
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Important: This is not investment advice. Consult a licensed financial advisor before making any investment decision.