In our weekend digest, we summarize the best pieces published from the working week. These can be read in full by clicking on the link over the name/ticker.
Editor’s Picks – a week full of central banks
Phil ran through the US Fed meeting, which saw the central bank raise rates by 0.25%. The expectations are now for potentially seven hike this year, something that could push pressure on US indices and boost the US Dollar.
In another preview, Phil spoke of why we expected the MPC to raise interest rates by 0.25%, with a prediction to offer more cautious guidance for the rest of the year. As a result, we thought that the outcome would be neutral for the FTSE 100, but likely negative for GBP.
This played out as expected, with the below QuickPick providing a useful summary in the immediate aftermath:
Stocks – driven by Ukraine and central banks
However, Tesla will eventually recover, along with other car manufacturers, from this current challenges. What can this mean? Right now, we may be looking at a discount sale for long term positions on many big names. From highs down to $700, Tesla fell over 43%. Long term, this could be a very short term downside in the big picture.
Tencent shares dropped 10% last night as Wall Street Journal reported the Chinese tech giant could be facing a record fine for violating money laundering rules. This has combined with the general bearish sentiment of the China tech sector as the government continues its regulatory tightening.
Data – fresh updates
Analyst recommendations provided by banks and brokers are a helpful guide in seeing what Wall Street and Institutional Investors think regarding the current price and future outlook of the stocks that they are analysing.
The analysis generally consists of in-depth fundamental evaluation of the company’s financial results, management team, industry, competitive forces, and technical factors. The stocks are then assigned a “BUY”, “HOLD”, “SELL” rating to indicate whether the stock is expected outperform, perform in-line, or underperform the market over the next 12 months. This is usually accompanied by a “Target Price”.
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