After seven weeks of declining markets, growth investors finally got a ray of sunshine, as the week closed on a upbeat outlook. Although Fed chairman Powell reiterated that this time they are really serious with tackling inflation and will make at least two half point interest rate increases in June and July, investors assumed it would be “two and done.”
Only time will tell, if this idea that inflation has peaked, and that the Bull Market can resume, is a case of “wishful thinking.”
A highly risky & speculative stock that may (or may not) be worth looking into is Kathy Wood’s ETF ARKK ($35) which concentrates on companies with “disruptive technologies.” In plain English, Ms. Woods, and her investment team, look for companies that are going to be the next generation of Apple, Facebook, Microsoft, and Amazon winners, creating new industries, and reshaping current business practices.
Retail investors fell in love with her ETF in the 2016-2020 period when it reached a high of $130/share. Since then it has been only downhill with a recent weekly low of about $32. Maybe, It would be worth readers’ time to do some research on this ETF. Ms. Wood’s has gone from “investment visionary” to investment “has been.”
Of course the market bounce this week may be the beginning of a multi week rally, or a periodic short covering rally. As long as the Fed continues to tighten it probably is wise to stay cautious. However, the Chinese Central Bank is flooding their markets with easy money policies, in an effort to stem growing unemployment and a sharp business contraction caused by Covid lockdowns.