U.S. stocks closed higher on Monday, with the Nasdaq up 1.9 percent and the technology and communications sector leading the gains. There are several major reasons behind the rise
U.S. stocks closed higher on Monday, with the Nasdaq up 1.9 percent and the technology and communications sector leading the gains. There are several big reasons behind the rise, including the stock of the US social media platform Twitter surging 27.12% to $49.97, the biggest increase since the social media platform first issued in 2013, with an intraday gain of more than 30% at one point, while almost all other growth stocks have followed these gains.
The main reason for the rise in Twitter's stock price is that the world's richest man has struck! That's right, Musk took a stake in Twitter. According to documents disclosed by the American Securities and Exchange Commission (SEC) on April 4, Tesla CEO Musk holds a 9.2% stake in Twitter, becoming the largest shareholder of the platform.
Why did Musk take a stake in Twitter?
On the one hand, because of the bear market in technology stocks, Twitter stock prices fell nearly 50% from last year's high, and Musk took the opportunity to bottom out and pick up cheap. On the other hand, it's not hard to find some clues from Musk's recent developments: Just a week ago, he hinted that he might reshape the social media industry, and musk will join the Twitter board of directors to give advice and voting rights to the company.
In addition, Tesla shares surged 5.6% today, and Tesla released a report on Saturday saying that global deliveries increased sharply in the first quarter of this year as a result of overcoming supply chain problems, and production levels have approached established automakers such as BMW and Mercedes-Benz. Supply chain issues have affected production at other automakers, with major automakers such as General Motors and Toyota saying sales had plummeted on Friday, largely because of component shortages. Deliveries increased significantly in the first quarter, reaching a record 310,000 units, up 67.5 percent year-over-year, in line with previous Wall Street forecasts.
Last month's Vip bottom Tesla tips
Historically, the bull market of "April" in the US stock market is coming
Today, the panic index, which measures market volatility, fell below the $20 mark. The VIX Panic Index shows a significant inverse correlation with the stock market, and in general, the VIX Panic Index rises and the stock market falls. The higher the VIX panic index, the higher it implies that investors are not optimistic about the stock market, and there is a high sense of panic about the market, which means some false prosperity.
VIX is an index that almost all investors must pay attention to, and it is mainly used in three aspects: observing market risk and investor sentiment, predicting market movements and fluctuations, and adjusting technical analysis and trading strategies.
At present, more and more fund managers are betting that the stock market index has been basically priced (price) to reduce the risk of the bond market, while there are many signs that the US economy is still in a healthy state. Bank of America's bull-bear indicators show a fall to 2.0 last week, the "buy" level. Historically, this indicator has delivered strong 3-month forward returns for global equities. The last time there was a counter-trend buy signal was on March 18, 2020, a few days before the stock market bottomed out after the COVID-19 outbreak. This is an indicator based on Bank of America's global survey of fund managers.
The first month of the second quarter was also the best month for U.S. stocks: Since World War II, S&P has risen 70 percent of the time, with an average gain of 1.7 percent in April, up from the full-year average of 0.7 percent. At the same time, as the S&P 500 index left the correction zone last week, the short- and medium-term rebound market is also worth looking forward to.
Of course, the historical data is for reference only, and the current market capital sentiment is still cautious. Data from financial data provider Refinitiv Lipper showed that in the week ending March, U.S. money market funds attracted $30.88 billion in inflows from investors to buy safer assets as they feared the Fed's aggressive stance on inflation could hit the economy. Data provided by Charles Schwab shows that last week, 41 million U.S. stock options were traded daily, at an all-time high. Many people are worried about the so-called inversion of the US 2-year Treasury yield and the 10-year Treasury yield again, that is, the 2-year Treasury yield is higher than the 10-year Treasury yield.
There is no shortage of bearish voices in the market
Bank of America's latest data shows that the short position replenishment situation has been completed. Investment banks Morgan Stanley, Bank of America and other banks pointed out that the recent rebound in US stocks is only a bearish retracement, the bear market rally has ended or is nearing the end, under the slowdown in economic growth, the macroeconomic background that is no longer loose is eroding corporate profits.
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