New Year Same Story

Here are the market observations for today

1. Will 2022 be a great year of equities? One can hope considering how bad the broader market was in 2021.
2. 2021 was a great year for index investors with S&P 500 up 27% with Energy and Real estate sector delivering the best gains.
3. The five largest components of the S&P 500 – Facebook, Apple, Amazon, Microsoft, and Google together returned 37% last year. They now constitute about 23% of the entire index.
4. What will drive the markets in 2022 – Labour Shortage, Inflation, Fed, Earnings, Politics or Pandemic. Omicron Variant is causing mass sickness.
5. It has been a nightmare at airports due to mass cancellations and the Omicron variant is making the labor shortage worse. But the market looks ahead. Airline and Cruise stocks are up sharply today.
6. The EV revolution is for real. Tesla delivered 308,600 electric vehicles in the fourth quarter of 2021. For the full year, the company delivered 936,172 vehicles, marking an 87% rise year over year.
7. Ford stock +4.4% today. It is one of the best EV stocks to hold. F-150 Lightning has been a great success and its current reservation stands at 200K.
8. There is general momentum in all EV stocks be it Lucid LCID Nikola NKLA, RIDE but the best stock to ride is Ford.
9. One safe economic prediction to make for 2022: The interest rates will rise. The company that will benefit from this trend: Bank of America. Why? Because it has the biggest noninterest-bearing deposit. The stock starts the year with gains.
10. Core Economy stocks moving higher. RIG, a play on Oil and Gas sector is up 12% today.
11. The emerging-market continues to be in a mess. Today, the Brazilian index EWZ is down 2.24%. [Brazilian President Jair Bolsonaro was taken to a Sao Paulo hospital today for health issues]
12. The 2021 problem spills on to 2022. Nobody knows why HIMX is down 15% today.
13. I love this kind of chart. Is BUD a buy?
14. One stock I am closely watching for a potential opportunity: Victoria Secret VSCO
15. “Don’t worry about what the markets are going to do, worry about what you are going to do in response to the markets.”

Trade Sheet:

Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purposes. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers