The Week in Review: 28th April-3rd May
Trading Performance
Last week marked the beginning of May, meaning that markets observed the Fed’s monetary policy decision, alongside key inflation day points including Friday’s Non-Farm and Total Unemployment pints. The general trend across UK and US equities has been higher since the 23rd April, as geopolitical tensions eased and hard commodity prices, notably WTI Crude began to stabilise and consolidate. All activity on the swing trading account was across UK equities, carrying two open positions into the week, and opening a further eight long positions through the week across two other companies.
In terms of sector specifics, the focus remained on financials (two banks) alongside one UK housing developer. The week’s worst performing trade was a long position in NatWest, which I closed 1% up (prior to stamp duties). The trade was based on technical signals but took a turn to the downside upon the announcement that the UK government were looking to sell their stake in the firm this Summer. The two positions that accounted for last week’s unrealised gains were closed on Tuesday 30th April, following a strong earnings call and positive forward guidance, leading to a move to the upside hitting my TP targets.
In terms of rate focussed equities, some hesitance through the start of the week was to be expected as markets traded toward Wednesday’s Fed rate decision. The decision was well received by the portfolio, with major movements to the upside occurring through Thursday, as traders priced out the possibility of US rate hikes, and priced in two potential cuts (50bps) for 2024. Though this remains below the Fed box plots expectation of 75bps, it provides a signal that analysts believe officials will move to ease investment and borrowing conditions this year.
All in all, last week marked a positive end to a strong month of performances for the swing trade account. The realised profit between the 29th April and 3rd May was 4.38% (including last weeks unrealised gains). When compared to benchmarks this is standout as the UK’s FTSE 100 (FTSE) only rose 73.66 points (0.9%) and the US’s S&P 500 ($SPX) rose 13.66 points (0.27%). I expect next week to be quiet in terms of personal positioning due to academic commitments. I am carrying no trades into the week, but will assess conditions looking to enter the market from the open on Wednesday. The Bank of England’s interest rate decision and forward monetary policy outlook will likely be the focus point of my attention, with interest rates central to my analysis of UK property developers, which have accounted for the bulk of my trades over the last month.
What to Watch Next Week:
Monday 6th May
Eurozone PMI (Final)
US Earnings:
($PLTR) Palantir
($MCHP) Microchip Technology Incorporated
Tuesday 7th May
UK Construction PMI
Eurozone Retail Sales (MoM)
US Earnings:
($DIS) Walt Disney Company
($BP) BP
($UBS) UBSWednesday 8th May
US Crude Inventories
US Earnings:
($TM) Toyota
($UBER) Uber
($BUD) Anheuser-Busch
($ABNB) Airbnb
($ARM) Arm
($SHOP) ShopifyThursday 9th May
BOE Interest Rate Decision
BOE Monetary Policy Statement
US Unemployment ClaimsFriday 10th May
UK GDP (MoM)
Sources:
https://uk.finance.yahoo.com/world-indices/
https://uk.finance.yahoo.com/commodities
https://www.londonstockexchange.com/indices/ftse-100
https://www.binance.com/en-GB/price/bitcoin
https://www.binance.com/en-GB/price/ethereum
https://qontigo.com/index/sxxp/
Stock Market Activity Today & Latest Stock Market Trends | Nasdaq
https://coinmarketcap.com/charts/#market-cap
https://www.forexfactory.com
Definitions:
YoY - Year on Year, or, Year over Year
MoM - Month on Month, or, Month over Month
QoQ - Quarter on Quarter, or, Quarter over Quarter
ECB - European Central Bank
BOJ - Bank of Japan
Fed - Federal Reserve
BOE - Bank of England
SNB - Swiss National Bank
DOJ - Department of Justice
PnL - Profit and Loss