By Jeffrey Cohen, Investment Advisor Representative
May 2, 2022: Pre-market
A few key take aways:
1. A few stonks / meme stocks are on the rise in pre-market. Bets are being made. Buyer beware $GGE Green Giant $MILE Metromile, $BBIG Vinco Ventures, $LGVN Longeveron, $MMAT Meta Materials, $FATH Fathon Digital Manufacturing Corporation, $AARQ Arqit Quantum and $EAR Eargo. Finally $AMTI Applied Molecular Transport.
2. The US equities markets were trading lower in pre-market. It looked like a very red open, very down. However, by the time the market opened the markets were flat. The RED movement pre-market was a head-fake. Nobody knows what will happen today, and this 'signaling' reminds me of tit-for-tat signaling or auction signaling studies we did in my PhD program. Read the signals, but don't take pre-market or after hours trading as gospel.
3. There were many bearish signs, and many bullish signs in the pre-market markets today:
Bearish: US Dollar up strongly, Bitcoin and crypto staging a rally, US Treasury interest rates moderating under 3%.
Bullish: People on Twitter were bearish. Stocks like $VZ Verizon Communications were up in pre-market. People were putting money to work, quietly, to earn a 5.5% dividend yield. Trucking index is higher, and most of our indices (money managers, efficient stocks, cannabis, crypto and miners) were mixed, with stocks up and down.
4. Technology growth stocks are getting less expensive. They are rising up very high on our 'smart volatility' CQNS UP Run. Especially the largest ones like $NVDA Nvidia, $QQQ The Nasdaq Composite 100 Index ETF, $MSFT Microsoft, $GOOG Alphabet, $AAPL Apple, and $AVGO Broadcom. These are showing up as being better investments from an efficiency perspective than most other sectors.
5. Returns in the market (exc. dividends) are all negative (vs. average close price for the past year)
Riskfree rate = 1.00%
Actual SPY return = -0.63%
Use floor S&P500 rate = 5.00%
Actual IWM return = -18.26%
Use floor Russell 2000 rate = 5.00%
Actual QQQ return = -7.49%
Use floor NASDAQ 100 rate = 5.00%
Market return = 4.00%
Good luck to everyone out there.
We do not have a bet or side in today's market except we are long three stocks (bagholding and waiting): $CRBP Corbus Pharmaceuticals, $AMS American Shared Hospital Services, and $SMLP Summit Midstream Limited Partners. We are glad to wait with these three names. We are very bullish on these for the longer-term. Might take a while for them to rise.
This is not investment advice.