11/20 Daily Market Note: We enter the final month of the year where Bullish Seasonality takes over

11/20 Premium Strategy Note - FOMO?

Hi Folks-

The markets are on lower-volume trading this week as Traders enter the shortened holiday Thanksgiving break, and this week offers only a select number of catalysts to dissect. There are a few companies reporting this week in my focus list, namely Trip.com and NVDA. Last week I discussed swapping BABA for KWEB as I believed that sector exposure to China along with my top ideas PDD EDU TCOM would likely continue to be the way to take the long-term view on China.

On TCOM earnings, analysts expect $1.87B and .68 cents EPS for the quarter. Looking beyond quarter-to-quarter, TCOM is positioned in the right vertical to benefit from any recovery from Chinese consumption as there is a growing trend towards travel & experiences among millennials and gen Z (a global trend also taking place in North America). BABA will eventually recover, but it will take time, and in the meanwhile there are companies that are positioned for stronger growth figures which is where investors may position for the time being. I estimate that Pinduoduo is taking up significant market share from BABA in Mainland China, and this is reflected in PDD’s strength.  

S&P 500 investors have brushed off a significant amount of macro worries, and Fund Managers (as well as market participants) who are chasing performance means that December is a month where demand for long positions may continue to persist. Given how strong the U.S. market has been, I would say being able to match the SPX 2023’s performance is in itself an amazing accomplishment. In this note, I’ll touch upon what stocks/areas I’m continuing to monitor for constructive upside in December.

This list is purposely selective and many more ideas will be discussed upon a healthy market pullback.