Everything looks bullish: What to watch this week
Everything is giving bullish signals. With tech, small caps, commodities, and gold all charging, while the US dollar is falling, along with bond yields, it seems everything is suggesting the Fed will likely cut rates by 25 bps (0.25%) this week. The renewed prospects for a 0.5% Federal Reserve cut has also added extra hot sauce to the bullish sentiment. Meanwhile, the Bank of Japan is expected to hold interest rates this week, after causing credit crunch concerns by raising rates at its last meeting.
On Monday, Australia's share market rose for the third session, to its second highest level in history, 8,145 and if we close at the level we're at now, 8,128, it will be a brand new record all-time high.
Sentiment is bullish following on from the US, where stocks carved out their best week in 2024, with companies that could benefit the most from policy easing seeing a huge kick. And this trend has legs to likely extend.
Today and this week, it's probably going to be full steam risk-on ahead of the Fed decision provided we don't get any hiccups and if the Fed's language and dot plot suggests other cuts are on the horizon (with a total of 1% of cuts expect before end of year).
Stocks and sectors to watch
- Not only will tech, small caps, etc., be in the spotlight, but it's worth watching...
· Last week's winners: ‘Hot chips’ Broadcom, SMCI, and Nvidia hit higher highs and gained the most last week, along with consumer beneficiaries and clean energy stocks. Keep those rate cut beneficiaries on your radar
· Globally, company stocks in solar, uranium, and lithium gained firepower after Trump and Harris both somewhat endorsed carbon-neutral energy. Meanwhile,lithium prices hit a new record low before charging up after CATL plans to close a key lithium mine, which will reduce China’s lithium output by 8%. So lithium stocks will be in the limelight as lithium was upgraded amid supply squeeze concerns. This was a key reason the world’s biggest lithium stock, Albemarle, jumped the most in 25 years. And other lithium stocks are following higher.
· Defence and cybersecurity stocks are worth watching, not only due to Trump’s second assassination attempt but also because China and the US military are set to resume talks for the first time in 2022.
· Nuclear energy power will be the talk of the town as fund managers increased their bets that it will make a comeback.
· Given clean energy metals like aluminum are up 2.3% today and 6% in five days, and copper is up 2% on Monday and 3.5% in five days, you might see heavy buying in commodity stocks. It seems the market is considering the possibility that China's dark days could be behind it after China's factory output, consumption, and investment slowed more than expected in August.
· Gold has continued to hit record all-time highs, nudging up slightly today to US$2,585.62 after adding 5% in a month, taking this year's gain to 25%, meaning it has outperformed every single stock market. I previously spoke about my thesis for why you can expect gold prices to hit new records, and maybe in a year's time, it could be knocking on US$4,000, maybe. Just maybe.
These comments were provided to media at 9.15am today and were included in an interivew with Reuters.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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Moomoo Official Market Strategist
Investment strategist seen and heard on global media such as Fox News Business, ABC, SBS, Reuters wires.
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151453268 witso : I like Hot Sauce especially sriracha mayo
股海踏浪 : Rise a fart, Buffett's decades-long undefeated general now has a historic high cash reserve
. He actually doesn't have a bullish view of the stock market 
. The ones entering the market now are all "leeks" 
.
Ultratech : it's bullish because of me
103301872 : Ridiculous
Jessica Amir OP 股海踏浪 : I see what you are saying. What I love about markets is that everyone has a different time frame for investing and also trading. Some investment managers stay the course, while also buying into pull backs. Pick what works for you. Whatever that may be :)
DeltaPa Jessica Amir OP : So true. Warren in fact is trying to park his cash in money market account to enjoy close to 5% short term rate. So it is not purely cash.