This week's live trading - 20240908 (US stocks edition): Non-farm payroll data is weak, safe-haven funds are front-running.

Overview:

This week, the S&P 500 index fell by 4.25%, and my actual portfolio value dropped by 5.26%.

Year-to-date in 2024, the S&P 500 index has risen by 13.39%, while my actual portfolio value has increased by 2.63% (starting the year with a net value of 1.26, now at 1.29).

Trades:

None

Holdings:

Apple 19.3%, Microsoft 17.6%, Google 10.8%, NVIDIA 9.6%, Petrobras 14.7%, TLT 12.0%, Bitcoin ETF 12.6%, Hermès 3.6%, Cash 0.8%.

Numbers are rounded, and positions below 1% are generally not recorded.

Review:

This week was a brutal one, with my U.S. stocks, Hong Kong stocks, and crypto accounts all plummeting. However, this was again due to short-term macro indicators—something unavoidable. If you hedge, you risk missing out on too many opportunities. As long as the negative factors don’t involve company fundamentals, you can always ride it out. That’s why, knowing that September historically sees pullbacks in U.S. stocks, I still chose not to hedge.

The main negative this week was on Friday, September 6th. Despite U.S. Treasury yields falling "as expected" due to weak August non-farm payroll data, the U.S. stock market once again proved "unpredictable." It opened higher on rising rate-cut expectations but then plunged sharply. The market focused on the "bad" components of the August jobs report, exacerbating fears of an economic slowdown and dampening risk appetite.

Some analysts noted that the underlying reason for Friday’s market tension was that stocks and bonds are far more sensitive to economic indicators than in the past. Investors know how crucial the "soft landing" narrative is for the U.S. economy, so market sentiment swings wildly. Even minor changes in economic data are amplified into recession fears or rapid rebounds when concerns temporarily ease.

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As for individual stocks, let’s focus on the most significant ones:

1. Tesla

On September 5th, Tesla’s official Weibo account announced a tech roadmap, projecting the launch of FSD in China and Europe in Q1 2025, pending regulatory approval.

During Tesla’s Q2 2024 earnings call, CEO Elon Musk revealed that the company is seeking regulatory approval in China and Europe for supervised FSD. This announcement of a concrete timeline signals substantial progress for FSD’s rollout in China.

FSD V12 is a completely new "end-to-end autonomous driving" system with major architectural changes. Musk stated that FSD V12 requires human intervention only 1% as often as V11. On March 31, 2024, Tesla rolled out FSD V12 (Supervised) to some U.S. users. Once FSD enters China, it could spark a new wave of competition in autonomous driving.

2. Apple

Apple’s most important annual event will take place on Monday at its headquarters, where the company will unveil the latest iPhone lineup, laying the groundwork for its new AI platform.

The event kicks off at 10 a.m. PT on September 9th (1 a.m. Beijing time on September 10th) in Cupertino, California. Apple typically holds its fall event on a Tuesday or Wednesday, but this year it was moved up due to conflicts with the U.S. presidential debate and an EU tax decision.

The highlight will be the iPhone 16 series, but Apple is also preparing major updates for the Apple Watch and AirPods. Additionally, Apple Intelligence is drawing significant attention.

3. TLT

With about ten days left until the Fed’s September 18th rate decision, the most critical data will be next Wednesday’s pre-market U.S. CPI report. July’s CPI growth slowed to 2.9% YoY, and August is expected to drop further to 2.6%, with core CPI holding steady at 3.2%.

After Friday’s jobs report, market expectations for Fed rate cuts swung wildly. Initially, there was a 65% chance priced in for a 50bps cut in September. However, as time passed and Fed officials spoke, expectations adjusted significantly. A 25bps cut in September is now the dominant view, with a 70% probability.

Still, Wall Street professionals caution that a 50bps cut can’t be ruled out entirely, making next week’s CPI data decisive.

Thursday’s PPI, jobless claims, and Friday’s University of Michigan consumer sentiment index could also serve as indicators for U.S. monetary policy.

Nothing else matters as much as these three, especially the last one, which will dictate the market’s next move. My personal bet remains on a soft landing, which is why I’ve started gradually adding tech stocks—using earnings and time to digest high valuations. Just hold on and avoid short-term predictions.

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Finally, here’s the chart (all values in USD):

Important Disclaimer (Must Read):

1. The buy points, target prices, and sell points in the chart above are calculated using my proprietary algorithms. There’s no universal formula, and they are not absolute or guaranteed. They simply help me gauge the current price.

2. If a price point has two values, the lower one is the floor and the higher one is the ceiling. Which one I use depends on my subjective judgment and understanding of the company—no fixed rules.

3. Blue and red highlights are personal reminders to focus when a stock nears a buy/sell zone, but they don’t guarantee action.

4. The numbers in the table are adjusted periodically based on price movements and my reassessment of the companies. Don’t treat them as long-term references. Even Buffett makes mistakes, let alone us mortals.

5. The table is for my personal trading records. It’s not investment advice. Don’t ask me whether to buy something—take responsibility for your own money.

6. If you hold any of these positions, feel free to discuss them with me in the comments. Point out my mistakes, and let’s learn and profit together.$iShares barclays 20+ Yr Treasury Bd(TLT.US) $Tesla(TSLA.US) $Apple(AAPL.US)