To The Moon

With dovish remarks by the Fed officials that recently rising bond yields are doing the heavy lifting for the central bank in reining in the sticky inflation, the market is increasingly expecting the Fed to finally halt the series of rate hikes when the officials meet at the end of this month.

Despite that the rates are likely to stay high for longer, a halt in the rate hikes is still an encouraging sign that the inflation is under control and cooling towards the Fed's long-term target of 2%, relieving the market over worries of a stagflation.

High growth stocks like $Sea Ltd(SE)$ , $Roblox Corporation(RBLX)$ , $Coinbase Global, Inc.(COIN)$ and $Li Auto(LI)$ as well as meme stocks the like of $AMC Entertainment(AMC)$ that are highly sensitive to interest rates in their valuations and rely on borrowing to finance their operations and expansions will likely benefit from the rate halt.

Furthermore, Sea may also gain from the resurgence of COVID cases recently as people turn to its e-commerce and online gaming. Likewise, Roblox will see more users, as youngsters stay away from outdoor entertainments. On the other hand, AMC having its stock overhang on dilution lifted and secured fresh funding from the equity issue may now position itself to stay relevant post-pandemic.

Meanwhile, hopes are running high on an eventual approval by SEC of an inaugural spot price-based ETF on bitcoin, upon which Coinbase will be among the winners as cryptocurrency trading garner renewed interests.

Electric vehicle deliveries by Li Auto have been encouraging and should see further update as the Chinese economy recovers. With growing global awareness of climate change and tightening emissions control, hopefully Li Auto will continue to grow and increase its market presence.

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