Issue #1: Unraveling the Market Dynamics

Welcome to the inaugural edition of our newsletter!

In this issue, we dissect the tumultuous market movements of the past week, highlight critical economic events, and delve into some intriguing investment opportunities.

Market Movers of the Week

Persistent Market Volatility: Wall Street concluded the week on a downtrend, extending a four-week losing streak. Concerns over the trade war and potential economic downturn overshadowed favorable inflation data. Investors are now keenly focused on the upcoming Federal Reserve interest rate decision.

Fears of Recession: Early in the week, fears of a recession led to a significant selloff, with the S&P 500 dropping by nearly 3% and the Nasdaq Composite by 4%. As trade tensions intensified under President Trump's tariff rhetoric, the S&P entered correction territory for the first time since late 2023.

Inflation Relief: Despite the market upheaval, both consumer and producer inflation reports for February provided some relief as they came in softer than anticipated.

Focus on the Federal Reserve: The Fed's monetary policy committee is meeting this week, with expectations to maintain the current policy rate. All eyes will be on Chair Jerome Powell's comments regarding the economy and trade tensions.

Sector Spotlight

Defense Stocks on the Rise: European defense stocks, including Leonardo, Thales, and Rheinmetall, have surged as Europe ramps up military spending, responding to U.S. foreign policy shifts. This may signal a broader realignment in global defense investments.

Companies like BAE, QQ, Steyr Motors will be some of the benefactors of the defense spending boost.

Trade War Escalation: The EU's retaliation against the U.S. tariffs on steel and aluminum is intensifying market volatility. Investors should brace for more turbulence as the global trade landscape continues to shift.

Hot Take: Intel's New Leadership

With Intel appointing Lip-Bu Tan as CEO, there's cautious optimism about a turnaround. Investors are hopeful, but substantive changes and results are critical for Intel to regain its footing in the industry.

Macroeconomic Outlook Key Events Next Week:

Monday: U.S. Retail Sales figures

Tuesday: Canada Inflation Data and U.S. Housing Data

Wednesday: U.S. Federal Reserve's interest rate decision

Thursday: UK Unemployment figures and Bank of England rate announcement

Friday: Japan Inflation Data Inflation Watch:

Inflation Data

UK: CPI inflation rose by 3% in January 2025, mainly driven by transport and food costs.

US: A slight easing in February 2025, with annual inflation at 2.8%.

Portfolio Updates In the past 90 days

I've made strategic investments in companies like AMD, Nvidia, and Intel, recognising them as undervalued opportunities with potential for growth over the next five years. I'm particularly intrigued by Microsoft's AI ventures and will be monitoring their developments closely.

Looking Ahead

Next week's earnings reports include highlights from Science Applications International (SAIC), FinVolution (FINV), and several tech giants, promising potential insights into market directions.

Overall Thoughts

Now is the time to carefully analyse and invest in stocks approaching their fair value amidst market corrections.

As always, this newsletter represents a sharing of personal insights, not formal investment advice.

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Disclaimer: The content shared is for informational purposes only and should not be considered financial advice. Always perform your own research before making investment decisions.