July Effect: How to seize the wave in the best month to be invested?
Hi Mooers! July is historically one of the best-performing months of the year for the stock market, and this year is no exception.
In fact, over the last 20 years, the best performance is seen in July, with the $S&P 500 Index (.SPX.US)$ gaining 2.6% on average, while the $S&P/ASX 200 (.XJO.AU)$ has generated the best return in July as well, with an average return of 1.95%.
We're gearing up for an exciting month with ASX 200 hit its record high, and we've curated insights from our community to focus on the following key areas:
- July's Pivotal Moments for Investors: We'll highlight the critical events and data releases that could sway market sentiment and present opportunities for savvy investors.
- Spotlights on Metals and Mining: With the sector's significant influence on Australian investment market, we'll delve into the trends and forecasts that are shaping the metals and mining landscape.
- Earning Season: Join us as we collect the important companies' earning reports in moomoo Earnings Hub to you!
📖 Must Read
...Small and mid-cap growth stocks are expected to benefit from the anticipated rate cut environment. Incorporating small and mid-cap value stocks into portfolios offers a balanced approach to capitalize on the expected market shifts in the latter half of the year...
🧠 How to seize market opportunities in July?
The US recorded an inflation rate of 3% last month from a year ago. The cooler-than-expected inflation raises hopes that US Federal Reserves governors would start cutting interest rates soon. It had been estimated to be 3.1%. Meanwhile, on a monthly basis, the consumer price index fell 0.1% from May due to cheaper gasoline, the first decline since the onset of the pandemic.
The figures add to evidence that inflation has resumed its downward trend after a flare up at the start of the year, while broader economic activity appears to be slowing.
A shotgun start to this week’s trading on the Australian market propelled the ASX200 across the 8000-point threshold for the first time, fueled by renewed hopes the US could soon start cutting interest rates.
A shotgun start to this week’s trading on the Australian market propelled the ASX200 across the 8000-point threshold for the first time, fueled by renewed hopes the US could soon start cutting interest rates.
Here's how the ASX 200 market sectors stacked up:
Banks: All four of the big banks have surged in recent months, and hit new 52-week highs. But it has been $CommBank (CBA.AU)$ that have shone the brightest. Over the past week alone, CBA has hit a series of new record highs.
ASX retail shares: ASX retail shares had a pretty decent year in FY24, with the S&P/ASX 200 Consumer Discretionary Index rising 19.29% over the 12 months.
Mooers Insight
The second-quarter 2024 earnings season will kick off in mid-July. Take a look at what to expect:
Early trial production of 2nm chips! Strong demand for Al compounded by a recovery in the consumer electronics market, can it help stock prices reach another peak? Check moomoo Earnings Hub to book the TSM Earnings Call!
TSM's Q2 2024 Estimates report will be published on Jul 18, 2024.
Tesla's price got a double-surge after the shooting stuff about US president candidate Trump. Though there's no supporting policies from Trump, the attitude from Elon Musk's continuous tweets supported the uptrend again.
Tesla's Q2 FY2024 Estimates report will be published on Jul 23, 2024.
🔨 Metals and Mining
Mooers Insight
Silver is up 33% year to date , gold is up 15.8%, and copper has gained 19.1%. The outlook for precious metals is good, as for industrial metals including copper due to impending Fed interest rate cuts.
Another big news we should to wach is, BHP is halting its Western Australia nickel operations starting in October, as the world’s largest miner struggles to navigate challenges posed by a substantial decline in nickel prices and a global oversupply.
If the iron ore futures price were a song, it would be "Smells Like Teen Spirit" by Nirvana. It seems the #IronOre price is getting 'high' off the 'perfume' that China's steel market could finally be turning around. Let's see if the price action sticks. I am watching BHP.
There is greater upside risk on natural gas and oil infrastructure as Tropical Storm Beryl, hit the Caribbean (a Category 5 hurricane) and is regaining strength as it heads for Texas. So watch oil and gas stocks.
🎁 Share & Get
What's your investing strategy for July or the second half of the year?
Share your thoughts in the comments. We will select up to 10 TOP COMMENTS for 200 POINTS next week, with which you can exchange gifts at Reward Club (moomoo - Me - Redeem Points)!
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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Here is my previous post about my 2H 2024 outlook and investing strategy written 2 weeks ago: 2024 H1 Recap: Four "D" Trading Strategy and H2 Outlook
There were 2 important events that happened since then:
1) Markets are confident that the Fed will announce a first rate cut in September. The argument supporting this is the positive inflation data for June in the US: the 12-month CPI indicator showed an increase of 3%, lower than the expected 3.1% and down from 3.3% the previous month.
The S&P 500 rose 1% in Wednesday stock market action, the biggest gain of its seven-session streak. The 10-year Treasury yield fell eight basis points to 4.20%, near a four-month low.
2) US presidential election candidate Trump assassination attempt brought wave to the stock market. Those companies who are in favour of his policies or have supported him, the stock price has surged. $Trump Media & Technology (DJT.US)$ soared 70% in pre-market and rose more than 30% at market closed.
My portfolio and trading strategy are prepared for a stock rally like this. I can use the high risk fund to buy covered call options to protect the upper side. Alternatively I can DCA into the value stocks that have dipped under the condition that the company of the stock is financially healthy. I will avoid meme stocks (or penny stocks), short selling, short selling naked put/call options because they are too risky for me; will continue to apply my Four "D" Trading strategy (Diversification, Distribution of fund based on risk level, Disciplined investment and DYODD).
102362254 : For my investment approach in July and the second half of the year, I plan to maintain diversification and stay updated with the latest news development. Strong corporate earnings may support growth, but volatility could arise due to the upcoming election and consumer sentiment.
mr_cashcow : Thank you for the points and it is now time for some investing strategy pointers![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
We are fast approaching the end of the year and with US election coming closer and the FED signalling rate cut in year end is finally close at hand so that should benefit small cap company stocks, historically under trump small cap company stocks also seems to perform well
yoongmy : For the second half of 2024, diversify investments across asset classes, sectors, and regions to manage risk. Focus on quality companies with strong financials and growth prospects. Allocate a portion to technology and innovative sectors like AI and renewable energy. Consider dividend-paying stocks for steady income. Invest in emerging markets for higher growth potential, while acknowledging the higher risk. Include bonds, particularly high-quality corporate and government bonds, for stability and income. Defensive sectors such as healthcare, utilities, and consumer staples can offer resilience during economic downturns.
JulW21 : My investment approach for 2nd of the year is to look for fundamentally strong company to invest over the long term. Since fed cut is confirm, diversify to bond fund is a good option too such as TLT.
Wonder : Mindful that strong corporate earnings may see stock price drop if forward guidance fall short of expectations (economic outlook is filled with uncertainty), may consider trade straddle to capture either price direction. Also looking for long term opportunities to buy the dip for promising tech stocks.
SneakyBear : For July and the second half of the year, my investing strategy is all about staying adaptable and diversified. Here’s what I’m focusing on:
First, I’m keeping a close eye on the tech sector, especially companies like Tesla and Netflix. Tesla’s ongoing innovations in AI with projects like Optimus and Netflix’s steady global expansion make these stocks very attractive.
I’m also diving into sustainable investing. With the world shifting towards cleaner energy, investing in green energy companies feels like a smart move for long-term growth.
Given the uncertain economic climate, I'm adding some defensive stocks to my portfolio. Utilities and consumer staples are great for mitigating risk during volatile times.
Emerging markets are also on my radar. As these economies recover and expand, there’s a lot of growth potential that I don’t want to miss out on.
For a steady income stream, I’m investing in REITs and high-dividend-yield stocks. These provide a nice cushion of regular returns, which is always a good thing.
Lastly, I’m keeping a close watch on interest rates. Even though they’re stabilizing, there’s still a lot of uncertainty. This helps me adjust my bond investments accordingly.
101550592 :
steady Pom pipi : I think the most important event in the second half of the year was to cut interest rates.
Gold Tops $2400 Amid Rate-Cut Hope: Is the Bull Run Over?
I prefer the real estate industry and precious metals sector.
Real estate-
I think interest rate cuts will have a huge impact on the real estate industry. However, some real estate-related stocks all provide good dividend income, so you can enjoy dividend income while laying out related industries ahead of time and waiting for stocks to increase in value.
Precious Metals-
Future interest rate cuts will cause the dollar to fall, and a fall in the dollar will cause gold to rise. I currently prefer to trade funds in the precious metals industry.
010Leo : diversification.
sgx: relook sreits, oil/gas. maintain bank. load in other sectors.
May need to lock in interest. beside mmf, looking into dividends and bond funds.
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