In April, U.S. stocks wrapped up the month with losses, marking their worst performance of the year across all three major indexes. The Dow recorded its toughest month since September 2022. This decline was driven by concerns over rising inflation and expectations of prolonged inflationary pressures, adding complexity to the market outlook.
There has been a significant shift in expectations regarding the actions of the Federal Reserve. Initially, there was speculation that the Fed might lower interest rates three times starting in June 2024. However, the current sentiment suggests there may only be one modest interest rate cut, if any, by the year’s end. Despite the Fed’s stance of patience and cautious observation before implementing any changes, there are voices advocating for prompt action due to persistent high inflation levels.
A lot of investors were hoping for a market pullback so they could jump in and make money. But when the market actually started to drop and fear spread, people got scared and started rethinking their plans. It just goes to show, that when it comes to investing, emotions like greed and fear can have a big impact on how people behave.
Tesla’s stock often mirrors shifts in investor sentiment, exemplified by its recent surge of over 43% from its one-year low of $138. Despite facing pressure from weakened electric vehicle (EV) demand, the company received a boost from Elon Musk’s trip to Shanghai, where deals were made regarding its Full Self-Driving (FSD) technology. This rebound has technically confirmed the stock’s long-term uptrend support, a point we discussed in our previous video ( https://youtu.be/9qEe-g03nV0?si=ew6cXBjCdrQp96Un). However, there is still one cap need to be filled although the second one has been filled recently. #TSLA still has a long way to go, with several key resistance levels ahead, including around $205, $222, and most significantly, the long-term downward trend line.
In April, our long-term investment portfolio experienced a setback, with a return of -12.16%, bringing the cumulative gain since May 2020 to 120.86%. Thanks to the recovery of #TSLA, our dynamic investment portfolio experienced a smaller loss of -7.17%, leading to an overall return of 55.97% since May 2020. (for detailed insights, please refer to our latest performance report).
One of our structural notes, which is linked to #AAPL #AMZN #TSLA, benefited from the recent rebound in #TSLA and matured by the end of April. The note achieved a total return of 53.21% since April 19, 2021. With its 50% barrier protection, this investment missed only one out of eleven quarterly coupon payments during the volatile three-year investment period. Goal achieved!
With the S&P500 still grappling beneath its 50 SMA, the market becomes increasingly sentiment-driven, influenced by fluctuations in inflation, Fed rate decisions, and company earnings. Bitcoin’s volatile movements mirror the recent market volatility, yet the bull trend remains intact for now.