May 3, 2022

Markets:

U.S. stock futures were little changed on Tuesday morning after the major averages staged a big reversal to start the month.

On Monday, the major averages posted a wild up-and-down session with the Nasdaq Composite rising 1.63% in a late-day comeback, despite falling as much as 1.07% earlier in the day. The S&P 500 rose 0.57% after hitting a new 2022 low earlier in the session.

Those moves come on the back of a brutal month in April for stocks. April was the worst month since March 2020 for the Dow and S&P 500. It was the worst month for the Nasdaq since 2008.

The benchmark 10-year Treasury yield also climbed to a new milestone on Monday. The bond yield hit 3.01% during the session, its highest point since December 2018. However, it fell back on Tuesday, possibly easing selling pressure on stocks.

Wall Street is largely expecting interest rates the central bank to raise rates by 50 basis points this week, with some investors believe expectations of aggressive monetary tightening from the central bank are already priced into markets.

The Federal Open Market Committee will issue a statement at 2 p.m. ET on Wednesday. Fed Chair Jerome Powell is expected to hold a press conference at 2:30 p.m.

Portfolio:

We enter the new trading session holding positions in ON, PLTR, AR, and ITRM . Absolutely wild session yesterday with a so-called “flash crash” in European markets on Monday which prompted several indexes to tumble sharply, sparking alarm among investors on a day when trading was thin due to public holidays around the world. The roller coaster swings within the markets were unsettling at times and you needed to just sit back and watch price activity and the range they continued to swing in. 

We will remain cautious today as well as all eyes are on the Fed release tomorrow. Stay patient. Stay nimble. Be ready for updates and a potential new trade set-up. Let's have a great session and just remember we are almost through this crazy price activity and will be rewarded with an outstanding market to trade soon enough.