Market Musings 3/9/2021
Quick thoughts on the markets and major portfolio news. Not on Ursa yet? Download Ursa from the App Store!
TLDR: High-growth stocks enter correction territory. Despite today’s rebound, we’re still neutral on Growth names and believe high quality still depressed #COVIDRecovery names have solid prospects to outperform into next year.
While markets surged today, high growth stocks had been under siege for the past several weeks. Before today, tech heavy NASDAQ fell over -10% from its peak on Feb 12 while the more diverse S&P 500 fell less than -3%.
Today, NASDAQ’s Herculean rebound recouped part of the loss, but still remains down -7% from its peak. Some Ursa portfolio stocks like AMD, NOW, NVDA & PYPL are still off over -15%.
We’re not surprised by the high growth spike－it was bound for a technical rebound as it approached correction territory. However, we don’t believe it’s over with #COVIDRecovery just starting driving #RisingYields inflation fears, #RetailInvesting recreational diversions, and impending #RevengeTravel.
We’ve been preaching #Flight2Safety sector rotation as a theme since the start of the year. While high growth names may rebound more, we continue to believe #Flight2Safety sector rotation continues through rest of the year (hopefully with less violent volatility 😬).
We still like our growth names longer-term. We wouldn’t look to sell owned growth companies right now, but wouldn’t look to rotate into them yet either. However, we would focus on adding high quality still depressed #COVIDRecovery names with solid long-term prospects that we believe can outperform this year and into next.
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As of the publish date, Ursa portfolios may own AMD, NOW, NVDA & PYPL. The stocks mentioned in this article may cease to be owned by Ursa portfolios at any point.
The statements, opinions and analyses presented here are provided as general information. This article is the opinion of the author. Anything within this article should NOT be considered an investment recommendation or advice. See Ursa’s full disclosures here.