Market review from UTEX – week 40

Indices rose another 1% or so during the week. The S&P 500 rewrote its all-time high three times. 

Chinese Central Bank stimulus caused fantastic gains in Alibaba Group Holding (+21%), JD.com (+39%), PDD Holdings (+35%), Bilibili (+45%), Uxin (+228%) and other stocks in China, which had their best week since 2008.

Tesla added 9% – the company may present a rudderless robotaxi prototype as early as 10 October. Tesla may also show its Optimus robot, which Musk fantasises says could bring its capitalisation to $25 trillion.

Bitcoin is up 4%, now trading at $63,600.

Thursday will see the release of jobless claims data, Friday will see the full employment report for September.

We continue to watch futures for a rate change at the Fed meeting on 18 December. There is now a 48% chance of another 50 basis point rate cut.

Top 5 trading ideas of the week

Carnival (CCL). Report on 30 September before the open. The cruise company was hit hardest in Covid-19. The reversal began in 2023. In July of this year, a resistance level of $20 was formed, which the stock has no way of breaking through. After the report the stock may overcome this mark and consolidate higher. Mid-Term. On the report day it is worth paying attention to other companies of the sector: NCLH and RCL.

Nike (NKE). Report on the 1st of October after the close. Following the news of the CEO change, the stock rose more than 10%. However, NKE is now trading at the same levels as a year ago. In our view, the mid-term prices are quite acceptable, plus the stock traditionally trades with high volatility intraday after the reports.

Constellation Brands (STZ). Reported on 3 October before the open. The U.S. beer maker trades like some of its customers on the report day – as volatile and unpredictable as possible. Exclusively for intraday trading if you like thrills. 

Paychex (PAYX). Report on the 1st of October before opening. Outsourced HR management: calculating payroll and benefits for small and medium-sized businesses. Not a bad move just on the report day, the other times it's better not to trade.

Shares of Chinese companies. A lot of “air” was formed here during the week: some stocks lagged behind, some were overbought. Pullbacks or reversals are possible – it is very interesting to see if the rally will continue. Probably, not all funds had time to enter, there is still enough volatility.

Have a successful trading week!