Market Overview
The following is a partial recap of the market analysis shared during today’s morning Discord call.
Today’s market opens in the red as the weekend failed to produce any news from the Middle East. Subsequently, oil is up another 2.4% from Friday’s close. Meanwhile, the trend of bonds rising has continued since last week, with Japanese bonds in particular soaring to new heights, with 30-year bonds currently trading at a hair over 4.0%. This signals a potential hike in interest rates, which, in conjunction with high inflation, paints a dire picture of the economy. We recommend looking into hedging options or simply holding onto your cash until things improve.
Softwares
The software sector is holding up relatively well, though it could be risky to get into right now. The semiconductor sector seems to have found a top last week, at around the 12,000 mark on the Philadelphia Semiconductor Index (SOX). We speculate that the software sector could see a boost as funds are rotated out of semiconductors and into software. We recommend keeping an eye on the sector to see things go from here, especially after NVIDIA’s (NVDA) upcoming earnings on Wednesday, 20th May.
Local Stocks
Naspers (NPN) & Prosus (PRX)
You might want to look at Naspers and Prosus for shorts, as Tencent (700) breaks through swing lows.
From left to right: Naspers (NPN), Prosus (PRX), Tencent (700)
We Buy Cars (WBC)
We Buy Cars has been buying and selling more cars than before. But the company faces pressure as the price of second-hand cars drops due to competition from new Chinese cars.
Nedbank (NED)
Nedbank has mostly seen drops lately. However, we speculate that it could see further upward movement if it breaks the R260. mark.
Earnings & Economic Data
Today is a quiet day in economic data and earnings.
Pre-Market Earnings
Baidu (BIDU)
Baidu is a Chinese multinational internet and A.I. company, with earnings today. It’s a closely watched stock following the meeting between President Trump and Xi Jinping.
Economic Data
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*Please note that these trade ideas form part of a larger weekly plan and the value of financial products can increase as well as decrease over time, depending on the value of the underlying securities and market conditions. The risk of loss arising from trading in Contracts for Difference can be substantial. You should carefully consider whether such investments are suitable for you in the light of your circumstances and financial resources.
