For Tuesday morning, stock markets will open with the S&P 500 (SPY) at yet another record high. On Monday, markets shook off a somber reminder from Fed Chair Jerome Powell. Although the Federal Reserve is in no rush to cut rates, markets turned bullish by around 2:30 p.m.
Speculators have few new stock ideas to run too. The Nasdaq (QQQ) jumped near the end of the day when traders added 2.29% to Apple (AAPL) stock. Alphabet (GOOG), Meta Platforms (META), and Microsoft (MSFT) rose slightly.
To ride the daily new highs, investors may accumulate the S&P 500 ETF, SPY, or IVV. Alternatively, the aforementioned stocks within the magnificent 7 are the most liquid trades. Tesla (TSLA) is not as attractive at these levels, since markets are ignoring the decreasing profitability of electric vehicles. Chinese EV firms, led by BYD Company (BYDDF), are flooding the European and South Asian markets with clean energy vehicles.
Amazon (AMZN), which trades near its high, could face increasing competition from PDD’s (PDD) Temu. In South Korea, Coupang (CPNG) is competing effectively to prevent Amazon from establishing market share.
Risks
Watch treasury bond yields. Consider the 20+ Year bond (TLT). Bond prices are showing signs of weakness after interest rates fell. As yields rise, stocks are less attractive.
