STOCK MARKET REPORT by CEO Silvano Grimaldi of the independent asset management company GRIMALDI & PARTNERS Ltd.

MONTHLY REVIEW

The international stock markets ended the month of APRIL with some significant losses.

DRIVING FACTORS

The fear of a rapid increase in key interest rates in the USA and possibly also soon higher interest rates in the euro zone.
Concerns about a recession in combination with high inflation, the Ukraine war, stressed supply chains and the worsening corona situation in China.
The Covid-related lockdowns in China threaten to exacerbate global supply chain problems and thus further fuel inflationary risks.

EQUITIES IN FOCUS

TESLA survives turbulence and shines with earning power

Tesla has shaken off the turbulence surrounding delivery bottlenecks and rising raw material costs and is setting new standards in the industry with its profitability. The US electric car maker, led by multi-billionaire Elon Musk, boosted its operating margin to 19.2 percent at the start of the year - four and a half percentage points more than in the previous quarter, reaching a level that dwarfs almost all other manufacturers. Only niche manufacturers like some sports car manufacturers can keep up. "Tesla is the world's most profitable carmaker after Ferrari," said auto professor Ferdinand Dudenhöffer. Tesla has achieved this thanks to high productivity, cost reductions and higher prices.

TESLA again with delivery record - over 310,000 cars in the quarter

Despite the global supply chain problems, the electric car manufacturer Tesla set another record for its deliveries in the first quarter of 2022. The company, led by US billionaire Elon Musk, brought 310,048 vehicles to customers in the first three months of the year, the company announced on Saturday (local time). That was almost 1,500 more than in the last quarter of 2021, when 308,600 vehicles were delivered. That was also a delivery record. In the whole of 2021, Tesla had delivered a good 936,000, an increase of 87 percent compared to 2020.

MONTHLY OUTLOOK

Despite rising inflation and tighter monetary policy, equities remain attractive should the global economy continue to grow in the coming months. The high valuation of the stock markets has also reduced as a result of this year's correction. In addition, investors are cautiously positioned so far, which means there is upside potential in the near term. However, the stock markets tend to be weak in the period between May and October.

Whether the stock market slogan “ Sell in May and go away ” will be correct this year probably depends on whether there will be positive surprises after so much negative news.

We expect a sideways trend for May.

STOCK RECOMMENDATION