The US stock market continued its monthly gains in August 20...
The US stock market continued its monthly gains in August 2021. Driven by results in the second quarter of 2021 that were better than market expectations, all major indices reached record highs. Below, we'll focus on the “recovery” theme after the Delta variant virus outbreak, including economic restart and the $1.2 trillion infrastructure bill aimed at long-term economic revitalization, to find different investment opportunities for the next few months.
After a successful performance: tech giants are still worthy of favor
The performance of US stocks in the second quarter of 2021 was strong. Overall earnings per share of the S&P 500 index increased 86% year over year, higher than the average forecast of 61%. Furthermore, the results for the second quarter of 2021 recorded higher-than-expected earnings and sales per share, which is also the highest since at least 1998, with the financial and information technology industries as the main players.
Looking ahead, we believe that the valuation of very large technology stocks is still reasonable, and the structural momentum driving fundamentals is still there, so we maintain a positive view of this field.
The theme of economic restart is attractive after adjustment
Shares in the travel and leisure industry have declined somewhat due to market concerns about the Delta variant virus. Overall, as vaccination in the US is progressing well, we believe the impact of the Delta outbreak is minor and likely to be short lived.
As a result, we believe investment opportunities have begun to emerge in some industries, including airlines, online travel agents, gaming, and travel, after undergoing adjustments over the past few months.
After a successful performance: tech giants are still worthy of favor
The performance of US stocks in the second quarter of 2021 was strong. Overall earnings per share of the S&P 500 index increased 86% year over year, higher than the average forecast of 61%. Furthermore, the results for the second quarter of 2021 recorded higher-than-expected earnings and sales per share, which is also the highest since at least 1998, with the financial and information technology industries as the main players.
Looking ahead, we believe that the valuation of very large technology stocks is still reasonable, and the structural momentum driving fundamentals is still there, so we maintain a positive view of this field.
The theme of economic restart is attractive after adjustment
Shares in the travel and leisure industry have declined somewhat due to market concerns about the Delta variant virus. Overall, as vaccination in the US is progressing well, we believe the impact of the Delta outbreak is minor and likely to be short lived.
As a result, we believe investment opportunities have begun to emerge in some industries, including airlines, online travel agents, gaming, and travel, after undergoing adjustments over the past few months.
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