Five Things to Start Your Week

A post-market update this week.

Our Alpha Portfolio is at +10.72% YTD.

• Leading: Silver at +30.49%

• Lagging: Vipshop Holdings at -5.33%

Market Snapshot

Technology and financial sectors are leading gains globally.

TSMC continues its strong run with a 4.13% increase, fuelled by demand for advanced chips, while ASML in the Netherlands is up 6.27%, indicating strength in the semiconductor space.

Indian banks such as HDFC Bank (+4.29%) and ICICI Bank (+1.20%) are seeing healthy gains, driven by strong earnings growth expectations and robust economic indicators.

Conversely, Chinese tech giants like Alibaba (-7.47%) and Pinduoduo (-10.31%) are under pressure, reflecting ongoing regulatory concerns and slowing demand in China.

In the energy sector, BHP in Australia dropped 2.33%, reflecting softer commodity prices and concerns over global demand, while TotalEnergies (TTE) in France declined 1.76%, signalling mixed trends in energy stocks globally.

Macro Trade Idea:

Long Commodities, Short Indian Financials:

• Long TSMC (+4.13%) and ASML (+6.27%): The continued strength in the semiconductor space, driven by AI and advanced technology demand, makes these stocks strong long positions. They are benefiting from secular growth trends, including AI and 5G adoption.

• Short Alibaba (-7.47%) and Pinduoduo (-10.31%): The Chinese tech sector is facing headwinds from regulatory pressures and a slowdown in consumer demand, making these stocks prime candidates for short positions in the near term.

These trades capture the growth momentum in semiconductors while hedging against weakness in the Chinese tech sector, which is experiencing regulatory and macroeconomic challenges.

The best thing we can do right now is trade with the momentum.

Biden’s Parting Present?

The US is sending an advanced missile defence system and associated troops to Israel to help shield its ally from attacks by Iran, the Pentagon said. Over the weekend, a Hezbollah drone strike killed four soldiers at a northern Israeli base, while at least 20 people died in an Israeli airstrike on a Gaza school, the Associated Press reported.

This Week’s Alpha Picks

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China Surge

Election latest: Kamala Harris said Donald Trump may be “too weak and unstable to lead,” needling him for keeping his medical records private after releasing her own. She and her VP pick Tim Walz will spend the coming week criss-crossing Blue Wall swing states.

Newsworthy

This is what’s caught our eye over the weekend.

• JPMorgan says 'soft landing' is here (WSJ)

• Big US banks say consumers still strong despite economy fears (RT)

• China stocks saw record inflows Japan saw biggest outflow in 20 years (RT)

• Musk reveals robots and robo-taxis at Tesla event (TC)

• Musk's SpaceX Starship rocket achieves record-breaking feat (TC)