Top traded counters in May 2023 June 26, 2023

Top traded counters in May 2023

Start trading on POEMS! Open a free account here!

At a glance:

  • G7 imposed additional sanctions on Russia
  • FOMC did a 25 BP hike and turned less hawkish
  • Democratic and Republican negotiators reached a consensus on the debt issue
  • Nvidia hit reached US$1 trillion market capitalisation


Tech heavy NASDAQ gained the most out of the 3 major indices with Dow Jones losing ground.

NASDAQ DOW JONES S&P 500
Month Open 12,210.05 34,116.81 4,166.79
Month Close 12,395.29 32,908.28 4,179.84
Monthly return 1.52% -3.54% 0.31%


Amidst the ongoing Russia-Ukraine war, the G7 leaders have expressed their commitment to imposing additional sanctions on Russia1. The primary objective behind these sanctions is to impede Russia’s ability to sustain the war by cutting off its access to G7 technology, industrial equipment, and services. One of the recent sanctions targeted Russian diamonds, and commodities such as aluminium, copper, and nickel that are produced or processed in Russia. The implementation of these sanctions may result in restricted trading of the commodities, potentially driving prices up.

However, it is worth noting that the effectiveness of these sanctions may be limited, as Russia continues to engage in unrestricted trade with China and India.

During the latest Federal Open Market Committee, or FOMC meeting, the committee implemented its 10th rate hike2. The recent hike amounted to a 25 basis point increase, taking the overnight interest rate to a range of 5.00% to 5.25%, its highest in 16 years. Federal Reserve Chair, Jerome Powell, noted that inflation has begun to recede and economic growth is slowing.

In contrast to the previous meeting, the committee decided to abandon the guidance provided at that time, which suggested that “some additional policy firming may be appropriate” to address inflation concerns. In the most recent meeting, the central bank emphasised the need to consider the effects of previous rate hikes, acknowledging that they would take time to impact the economy. These factors will be taken into account when determining the potential need for further hikes. This represents a less hawkish stance as compared to the previous meeting.

Following the FOMC meeting, market participants grew concerned about the possibility of the US government defaulting on its debt after Treasury Secretary Janet Yellen projected that the treasury would exhaust its cash reserves by 5 June 20233. The consequences of the US defaulting on its debt can be severe and far-reaching. With the US as a major player in the global economy, the US defaulting could disrupt international trade, financial flows and investment activities that could lead to a global economic slowdown. Furthermore, those who hold US debt may encounter significant losses.

US President Joe Biden engaged in several meetings with House Speaker Kevin McCarthy to address the issue of raising the debt limit4. However, reaching an agreement proved challenging due to divergent views of the two parties.
The Republicans advocated raising the debt limit contingent upon a reduction in government spending. The democrats on the other hand, were opposed to spending cuts and did not support linking them with the potential increase in debt limit.

Finally, on the night of 28 May 2023, Democratic and Republican negotiators reached a consensus on the debt issue5. The next step involved seeking approval from the Congress. Once it has been approved, the Fedwould be able to continue borrowing until the next Presidential election that is scheduled for November 2024. The agreement did not raise the debt ceiling, but instead suspended it till 2025. Without a debt ceiling, the government can make its payments with certainty, without worries about how to fund the upcoming Presidential election. However, despite the suspension of the debt ceiling, there will still be spending caps in place for all areas, except defense.

Against these backdrops, here are some ETFs for your consideration:


abrdn Physical Gold Shares ETF (NYSE-ARCA: SGOL.US)

SGOL is an ETF that seeks to reflect the performance of the price of the gold bullion, less the Trust’s expenses6. The ETF is backed by physical gold bullion bars stored in vaults in London, UK and Zurich, Switzerland. SGOL commenced on 9 Sept 2009 with an expense ratio of 0.17%. SGOL’s 10 year performance as of 31 March 2023 is 1.83%.

SGOL opened at US$19.17 and dropped 1.98% to close at US$18.79 in May 2023.

Technical analysis

Top traded counters in May 2023

Status: Neutral

Support: 18.00 – 18.10

Resistance: 19.00

Range-bound


SPDR® Gold MiniShares® Trust ETF (NYSE-ARCA: GLDM.US)

GLDM is an ETF that seeks to reflect the performance of the price of gold bullion, less GLDM’s expenses7. The gold custodian is with ICBC Standard Bank Plc. GLDM commenced on 25 June 2018 with an expense ratio of 0.10%. GLDM’s 3 year performance as of 31 March 2023 is 7.55%.

GLDM opened at US$39.75 and fell 2.01% to close at US$38.95 in May 2023.

Technical analysis

Top traded counters in May 2023

Status: Neutral

Support: 37.40 – 37.60

Resistance: 39.40 – 39.50

Range-bound


Here are some popular US stocks – not ranked in any order – traded by POEMS customers in the month of May 2023.

NVIDIA Corporation (NASDAQ: NVDA)

NVDA reported stellar earnings in May. EPS and revenue of US$1.09 and US$7.19 billion, both beat estimates of US$0.92 and US$6.52 billion respectively. NVDA data center group reported US$4.28 billion in sales, versus expectations of US$3.9 billion, a 14% annual increase. The better than expected sales were largely driven by demand for its GPU chips from cloud vendors as well as large consumer internet companies to train and deploy generative AI applications like OpenAI’s ChatGPT.

For the next quarter, the firm expects sales of about US$11 billion, plus or minus 2%, more than 50% higher than Wall Street estimates of US$7.15 billion.8 Later in the month, NVDA reported hitting US$1 trillion in market value due to the booming AI demand.9 In May, NVDA opened at US$278.40 and gained 35.90% to close at US$378.34.

Referring to the Phillip Research report dated 29 May 2023, the recommendation for NVDA is to Accumulate.

Technical analysis

Top traded counters in May 2023

Status: Bullish

Support: 330.00 – 335.00

Resistance: 400.00

The bullishness is slowing down, and the price is looking for proper support after the bullish gap up.


Apple Inc (NASDAQ: AAPL)

AAPL reported earnings that beat estimates in May 2023. The EPS of US$1.52 exceeded estimates of US$1.43. Revenue was reported at US$94.84 billion, higher than estimates of US$92.96 billion. The better-than-expected results were largely contributed by iPhone sales, reported iPhone revenue was US$51.33 billion, higher than estimates of US$48.84 billion.

The firm did not provide any formal guidance but expects the following quarter revenue performance to be similar to the reported quarter; provided the macroeconomic outlook does not worsen. The firm’s board authorised US$90 billion in share repurchases and raised its dividend by 4% to US$0.24 per share.10 In April 2023, AAPL opened at US$169.28 and gained 5.33% to close at US$177.25.

Referring to the Phillip Research report dated 8 May 2023, the recommendation for AAPL is to Accumulate.

Technical analysis

Top traded counters in May 2023

Status: Neutral

Support: 170.00

Resistance: 180.00 – 185.00

The bullishness is slowing down, hence we advise investors to wait for the price to sustain above 170.00.


Paypal Holding Inc (NASDAQ:PYPL)

PYPL reported earnings that beat estimates in May. The EPS was reported at US$1.17, beating the estimate of US$1.10. Revenue of US$7.04 billion was also higher than the estimated US$6.98 billion.11

The firm highlighted its push towards Artificial Intelligence (AI) in a call with analysts, as it expects new advances in generative AI to help accelerate its productivity initiatives and enable them to lower its future cost of production.

The firm lowered its outlook for the annual adjusted operating margin, from 1.25% to 1%. 12The firm expects an EPS of US$1.15 -1.17 for the next quarter versus analyst consensus of US$1.17. For the whole financial year, the firm expects EPS of US$4.95 versus the analyst consensus of US$4.88.13

In May 2023, PYPL opened at US$76.03 and dropped 18.47% to close at US$61.99.

Referring to this Phillip Research report dated 11 May 2023, the recommendation for PYPL is a Buy.

Technical analysis

Top traded counters in May 2023

Status: Neutral

Support: 57.50 – 58.00

Resistance: 64.45 – 64.80

The mood is bearish, but a range should be starting at this minor area.


Airbnb Inc (NASDAQ: ABNB)

ABNB reported earnings in May. The EPS of US$0.18 beats estimates of US$0.09. Its revenue of US$1.82 billion was also higher than estimates of US$1.79 billion. Total revenue rose 20% year over year. Airbnb swung to a net profit of US$117 million, from a net loss of US$19 million in the year-earlier period. The figure marks the first time Airbnb has been profitable during its first quarter on a GAAP basis.

Despite a strong start, the firm warned that the next quarter comparisons would be tough; the Nights and Experiences booked will have unfavourable year-over-year comparisons in Q2 2023 as they overlap pent-up 2022 demand following the COVID-19 pandemic. The firm’s forecast for the next quarter’s revenue to be between US$2.35 billion and US$2.45 billion while analysts expect it to be US$2.42 billion.14

In May, ABNB opened at US$119.26 and dropped 7.96% to close at US$109.77.

Referring to the Phillip Research report dated 17 May 2023, the recommendation for ABNB is a Buy.

Technical analysis

Top traded counters in May 2023

Status: Neutral

Support: 103.50 – 104.00

Resistance: 115.60

Range-bound


Block Inc (NYSE: SQ)

SQ topped estimates in May. The EPS and revenue of US$0.40 and US$4.99 billion both beat estimates of US$0.35 and US$4.6 billion, respectively.15

The reported EPS and revenue were up 122% and 26% respectively from a year ago. The better-than-estimated earnings were driven by strong momentum across the Cash App ecosystem, which contributed US$3.27 billion to net revenues for the reported quarter, up 33% year over year.16

For the full year, the firm raised its profit target to US$1.36 billion on adjusted EBITDA, more than 35% growth year-over-year. 17In May, SQ opened at US$60.69 and dropped 0.49% and closed at US$60.39.

Referring to the Phillip Research report dated 9 May 2023, the recommendation for SQ is a Buy.

Technical analysis

Top traded counters in May 2023

Status: Neutral

Support: 51.50 – 55.50

Resistance: 70.30

Range-bound


CONCLUSION

With the approval of the debt ceiling bill, one major uncertainty has been eliminated from the market. The economy appears to be resilient, as indicated by the performance of the companies discussed above. Interest in the AI industry has been booming amongst market participants, as evidenced by NVDA’s positive chip demand forecast, which propelled the company into the trillion-dollar club.

Looking ahead, the probability of an announcement for a rate hike in the next FOMC meeting seems low18. The committee has already implemented 10 consecutive interest rate increases, and may require additional time to assess the state of the US economy following this series of hikes. However, it is important to note that skipping a rate hike may not necessarily indicate a pause, as further increases may be deemed necessary if inflation remains above the target level.


Bloomberg analysts’ recommendations

The table below shows the consensus and average ratings of all analysts updated on Bloomberg in the last 12 months. Consensus ratings have been computed by standardising analysts’ ratings from a scale of 1 (Strong Sell) to 5 (Strong Buy). The table also shows a number of analysts’ recommendations to buy, hold or sell the stocks, as well as their average target prices.

Security Consensus Rating BUY HOLD SELL 12 Mth Target Price (US$)
NVIDIA Corporation (NASDAQ: NVDA) 4.6 49 (84.5%) 8 (13.8%) 1 (1.7%) 451.14
Apple Inc (NASDAQ: AAPL) 4.33 36 (73.5%) 10 (20.4%) 3 (6.1%) 180.95
Block Inc (NYSE: SQ) 4.32 36 (72%) 11 (22%) 3 (6%) 88.20
Paypal Holding Inc (NASDAQ:PYPL) 4.3 35 (66%) 18 (34%) 0 92.81
Airbnb Inc (NASDAQ: ABNB) 3.66 18 (43.9%) 19 (46.3%) 4 (9.8%) 129.60



Get yourself educated! Join our free webinar here!


Top traded counters in May 2023


Trade Smarter and Faster
With our newly launched POEMS Mobile 3 Trading App

Explore a myriad of useful features including TradingView chartings to conduct technical analysis with over 100 technical indicators available!

Take this opportunity to expand your trading portfolio with our wide range of products including Stocks, CFDs, ETFs, Unit Trusts and more across 15 global exchanges available for you anytime and anywhere to elevate you as a better trader using our POEMS Mobile 3 App!


Reference:

Disclaimer

These commentaries are intended for general circulation. It does not have regard to the specific investment objectives, financial situation and particular needs of any person who may receive this document. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of the units and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. Investors may wish to seek advice from a financial adviser before investing. In the event that investors choose not to seek advice from a financial adviser, they should consider whether the investment is suitable for them.

The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries.

Views and any strategies described in these commentaries may not be suitable for all investors. Opinions expressed herein may differ from the opinions expressed by other units of PSPL or its connected persons and associates. Any reference to or discussion of investment products or commodities in these commentaries is purely for illustrative purposes only and must not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the investment products or commodities mentioned.

About the author

Global Markets Desk US Dealing Team

The Global Markets Desk US Dealing team specialise in handling the US Markets in the Global Markets Desk.

Their responsibilities and capabilities extend from managing and taking orders from clients trading in the US market, to content generation, Technical Analysis and providing educational content to POEMS clients.

Contact us to Open an Account

Need Assistance? Share your Details and we’ll get back to you

IMPORTANT INFORMATION

This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <www.phillipfunds.com> for more information in relation to the dividend distributions.  

The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

This advertisement has not been reviewed by the Monetary Authority of Singapore.  

 

Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
Tel: (65) 6230 8133 Fax: (65) 65383066 www.phillipfunds.com