The global economy is likely entering a “war-cession” ~ David Roche
Everybody is screaming recession. There is fear everywhere and for the right reason. The markets continue to decline. Nothing is getting spared and even stocks like Apple to Microsoft getting dumped. But even during extremely dark times, there are always some stocks that continue to attract money. The objective of the newsletter is to bring your attention to such stocks.
AT&T makes a Gap up move as a new company
AT&T is now a core Telecom company after spinning off its media business and merging with Discovery. It’s a fresh start for the company and is making a big 5% Gap up move, thanks to a big upgrade from JP Morgan. In a market where everyone is running away from speculative growth business stocks, AT&T stock offers safety. I expect the Gap up momentum to sustain.
Twitter Fills the Gap and rallies
Elon Musk taking a 9% stake in Twitter is the turning point for the stock. Last week, Twitter management announced the appointment of Elon Musk to the Board and then withdrew it yesterday. But that changes nothing for the company. Elon Musk as an investor is the thing to watch out for. The stock not selling off on today’s new is encouraging development.
The Bad News: AMD slips below the Support Level
The Favorite stocks of Growth investors are falling with no support. And the newsflow is also not positive. There are reports that Semiconductor demand is slowing down. No wonder today AMD and NVidia are selling off. The breakdown of AMD below 100 is distressing, to say the least. If the stock sustains below 100, it can decline to levels of 75. Imagine AMD was at 160 just six months back. One can still hope that AMD will recover and close above 100 but as of now, it’s not looking good.
There is strong selling in Leadership names. When was the last time you saw stocks like Microsoft selling off 3.67%
Brent Crude Oil prices have cooled off and are driving up Travel stocks like Airlines/Casino
Today Airline and Cruise stocks are up and a small tactical rally is possible in the space. There is bullish interest in ETFs like JETS and AWAY. Also, the sell-off in Crude is driving down the prices of Oil stocks be it Exxon Mobil XOM or Occidental Petroleum OXY.
The Value stocks are doing well
CVS has made a grand comeback in a declining market environment. I recommended this stock at 102 a few days back
Large Cap Portfolio: 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
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