Month: May 2023

Stocks rallied on rising optimism that D.C. lawmakers will reach a deal to raise the U.S. debt ceiling, led by the tech-heavy Nasdaq, which closed at its highest level since August. For the full week, the Dow Jones index lost 1%, but the S&P 500 edged up 0.3% and the Nasdaq jumped 2.5% for a fifth straight week of gains. May 26th, 2023 The big mover this week was Nvidia, whose shares did ‘one of the greatest moonshots in the annals of capital market history’ by closing up almost 25% – equivalent to a market value of ~ $ 184 Billion – after it announced results for the quarter ended April 30th 2023. The Company said it expects gigantic expansion ahead as data centres switch to its products incorporating AI.

The stock market rally strengthened this past week. The Nasdaq composite and S&P 500 hit 2023 highs, with the Nasdaq 100 setting its best levels in more than a year. Market breadth continued to be very narrow, with gains led by AI-infused tech leaders such as Nvidia (NVDA), Advanced Micro Devices (AMD), Service Now (NOW), Google parent Alphabet (GOOGL), Snowflake (SNOW) and Palantir Technologies (PLTR).

Markets remained relatively range-bound last week, with a continuation of the battle between strong big tech and weak cyclical risk-on sectors. On economic data, the number of Americans filing for unemployment benefits rose by 22 thousand to 264 thousand on the week ending May 6th, the most since October 2021, and well above market expectations of 245 thousand. This is at odds with the strong jobs data that we saw last week and presumably suggests a turning point in the employment situation.

Another week, another bank in trouble We have repeatedly alluded in our newsletters to the lag effect of the rapid interest rate hikes set in motion by the U S Federal Reserve in early 2022 and warned that it would take several months before the full effects become clear Since March 2023 almost exactly a year since the hikes began, the following banks have collapsed in the U S alone Silvergate Bank, the 147th largest bank Silicon Valley Bank, the 16th largest Signature Bank, the 29th largest