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  • Following a lackluster April, May was on fire! ๐Ÿ”ฅ

Following a lackluster April, May was on fire! ๐Ÿ”ฅ

The bull market is back! ๐Ÿš€

Hi GRIT VIP!ย ๐Ÿš€ And welcome to our thousands of new VIPs! This is our monthly portfolio review, brought to you by GRIT CEO Genevieve Roch-Decter. It's one of the many exclusive newsletters you receive each month. Let's dive in! ๐Ÿ‘‡

Following a lackluster April, May was on fire! ๐Ÿ”ฅ

"Game on, Garth!"

The bull market is back! ๐Ÿš€

Meme stocks are soaring! ๐Ÿ“ˆ

Bitcoin is flirting with new record highs! ๐Ÿ’ฐ

Will "sell in May and go away" be the strategy, or is this time different? Letโ€™s dive in!

The S&P 500, Dow, and NASDAQ all hit new record highs! ๐ŸŽ‰

Will "sell in May and go away" be the strategy, or is this time different? Letโ€™s dive in!

  1. ๐Ÿ“Š Update on May

  2. ๐Ÿ“ˆ Interest Rates & The FED

  3. ๐Ÿš€ NVIDIA does it again!

  4. โš ๏ธ Word of Caution: Stock Concentration!

  5. ๐Ÿ“‰ Q1 2024 GDP Revision

  6. ๐Ÿ’ผ Portfolio Changes

  1. Update on May:

S&P = +4.80% (+10.64% YTD)
NASDAQ = +6.88% (+11.48% YTD)

Sectors MTD and YTD:

7 largest companies in the S&P 500 year-to-date:

Source: Bloomberg (May 31st, 2024)

โ€œEVERYTHING (except Materials & Real Estate) RALLYโ€

Ten out of eleven S&P 500 sectors are now up year-to-date. The only exception? Real Estate down -7.13% YTD.

No surprise, the big winners this month were Information Technology (+9.96% MTD), Utilities (6.68% MTD), and Communication Services (+5.97% MTD). The losing sector is Energy (-3.37% MTD)

All eleven S&P 500 sectors exceed their 200-day moving averages, signaling a broadening market rally.

Itโ€™s a strong rebound from Aprilโ€™s performance.

If this bounce follows past patterns, more gains could be on the horizon. Historically, according to Keith Lerner (Truist Advisory Services), S&P 500 rebounds from 5% pullbacks see a median gain of 17.4%. As of Friday, May 31st, 2024, the index is up nearly +6.25% from its April lows (see Bloomberg chart below).

โ€œOnce you find the low, the market typically has further to go than what we've seen so far,โ€ said Lerner, who studied data back to 2009.

Broad historical comparisons suggest more upside for the current bull market. Lerner's study shows a 108% median climb for bull markets since the 1950s, compared to the nearly 50% gain since October 2022.

The median bull market length has been just over 4.5 years versus the current 1.5 years.

  1. Interest Rates & the FED

According to Bloomberg, the market anticipates only ONE interest rate cut for 2024, down from two cuts expected just over two weeks ago when April CPI inflation came in at 3.4%, slightly lower than March's 3.5%.

Since January, the market has priced out expectations for FIVE interest rate cuts.

On Wednesday, Goldman Sachs CEO David Solomon stated he expects zero cuts this year. "I'm still at zero cuts," Solomon said at a Boston College event. "I think we're set up for stickier inflation."

His comments followed Federal Reserve policymakers' remarks on Tuesday that the U.S. central bank should wait several months to ensure inflation is back on track to its 2% target before cutting interest rates.

Last month, Jamie Dimon also warned of potential rate hikes.

I've been saying for months that I donโ€™t expect the FED to cut rates anytime soon.

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