To The Moon

US stocks technology stocks return to the king in Q1 2023, see Weekly: After Tech's Q1, How Will You Trade a Strong April Market?

The Q1 presented both risks and opportunities. The risk was that the Feb U.S. non-agricultural data exceeded expectations; the market expected that Europe and the United States will accelerate interest rate hikes, and U.S. bond interest rates rose sharply; On March 10th, the $SVB Financial Group(SIVBQ)$ collapsed within 48 hours. After that, $Credit Suisse Group AG(CS)$ collapsed, resulting in a banking crisis, then central banks in Europe and the US vigorously rescued the market. The market fluctuated violently.

The opportunity was that $Microsoft(MSFT)$ released CHATGPT on February, and integrate it into all products to start the AI wave. Among the major asset classes, technology stocks were back as king.

Regarding the expectations for the Q2 market, the market believes that the main contradiction will lie in the development of the Euro and US banking crises and the expected progress of the Fed peaking of interest rate hikes.

Q2 Quarterly Outlook from Fidelity

Capital_Insights sorts out the macro expectations and risk assets outlook of Q2 from 4 institutions analysis. Welcome to comment on the following content if you agree with.

Disclaimer, the content is credit to four analysts, and the views are for communication only.

1. Regarding Q2 2023 Macro Economic Outlook

Daniel Dubrovsky, Senior Strategist DailyFX.com:“All Eyes on Economic Data in Q2”

The stark divergence between the Fed and markets means that at the end of the day, one of these two will be wrong. One one hand, If the market is wrong, the $NASDAQ(.IXIC)$ and equities broadly will be very much vulnerable going forward as rate-cut bets are priced out.

On the other hand, if the Fed is wrong, the economy is likely heading for trouble. Based on a study, historically, the $S&P 500(.SPX)$ has declined about 7% on average during the first 3 months of US recessions since 1969. With that in mind, only ongoing data will tell how the US economy absorbs the aftermath of $SVB Financial Group(SIVBQ)$ ’s collapse.

Dan Victor, Leader of Conviction Dossier: “See room for more upside through Q2”

We've been calling the rally in recent months and see room for more upside through Q2, two reasons:

1) The upcoming catalysts here include the next CPI update, which can provide some confirmation that the "disinflationary process" is ongoing and that the Fed's strategy is working. We expect market sentiment to benefit from stabilizing interest rates.

2) Q1 2023 earnings season should also be solid with high-profile mega-cap companies well-positioned to beat what may be a low bar of expectations.

Dave Sekera, market strategist at Morningstar: “Headwinds to Turn Into Tailwinds in Late 2023”

We acknowledge there may be additional bank failures, we do not think this is the beginning of a new financial crisis. Except for the rapidity as to how fast these stock prices have fallen, the current situation is much different from what prompted the 2008 global financial crisis. While there are negative economic and market consequences to this liquidity crunch, it will not result in a wholesale freeze across the financial system.

Monetary tightening is either at, or close to, an end, but market will be looking for increase in leading economic indicators to begin viable rally.

In our 2023 Market Outlook, later this year would be a transition year from the headwinds into tailwinds:

1) Slowing rate of economic growth to re-accelerate in Q4.

2) Monetary policy to pause, then pivot to easing.

3) High inflation to moderate over course of the year.

4) Rising long-term interest rates to roll over.

2.Stocks, Oil, Gold Q2 2023 Outlook

Dave Sekera: Both value and growth categories remain undervalued

Stocks surged in January, coming off deeply undervalued levels and a technically oversold market in December. However, the market gave back almost half of those gains in February and March.

According to a composite of the 700-plus US stocks we calculate that as of March 23, the market was trading at a price/fair value of 0.88, a 12% discount to an aggregate of our intrinsic valuations.

According to our valuations, investors appear best positioned in a barbell-shaped portfolio by being overweight value and growth and underweight core. Both value and growth categories remain undervalued, the core category is much less attractive relative to the broader market average as it remains closer to fair value.

Thought Leadership from Obex: $Gold - main 2306(GCmain)$ and Bitcoin set to appreciate

The banking crisis, inflation worries, and rising global uncertainty drove a lot of investors to safe-haven assets and specifically gold in the first quarter of 2023 and unless there’s any change to the current volatile climate, I would expect gold prices to continue to trend higher in Q2. A weaker dollar will also make gold even more attractive to investors in Q2.

Thought Leadership from Obex: $WTI Crude Oil - main 2305(CLmain)$ prices likely to remain high

In early Q2, oil prices surged after several of the world's largest exporters announced surprise cuts in production. The trend is set to continue as exporters will seek to maintain prices at current levels during the summer season. What I would urge investors to keep an eye on is the situation in Russia-Ukraine. Any positive outcome on that front could decimate Brent and Crude valuations along with energy stocks.

Daniel Dubrovsky at DailyFX.com: the stock market will begin to recover

The good news is that inflation has been trending lower for the past 3 months and we could see even lower inflation in mid-2023. In terms of how the stock markets are reacting to the news, it is important to always remember that the market is forward looking. I would expect that as soon as the Fed signals its last rate hike, the stock market will begin to recover.

Any unexpected easing in monetary policy could also spark a full-fledged rally in the tech, stock, and cryptocurrency markets.

Source:https://seekingalpha.com/article/4592247-q2-stock-market-outlook-the-path-to-4500-in-spx

Source: https://www.dailyfx.com/news/equities-q2-fundamental-outlook-who-is-right-about-svb-the-fed-or-markets-20230402.html

Source: https://www.financemagnates.com/thought-leadership/2023-q2-market-outlook-what-lies-ahead-for-global-markets/