Tuesday's Hottest Trades

Market conviction to buy on the way up is losing momentum. Traders are now waiting for two key economic data points in the next week. On Friday, the U.S. jobs report will tell the Fed if it has the flexibility to keep interest rates at current levels.

With rates unchanged for now, expect bank stocks to stay hot, near 52-week highs. Citigroup (C), Bank of America (BAC), Morgan Stanley (MS), and Goldman Sachs (GS) should add a few points ahead of time.

Next Tuesday, the market will check if the consumer price index indicates elevated inflation. Markets will bet on weaker February inflation. They will speculate with the 20+ Year Treasury (TLT). Income investors will continue to accumulate Schwab U.S. Dividend Equity ETF (SCHD).

Avoid the Electric Vehicle Sector

The Tesla (TSLA) sell-off worsened yesterday after shares fell by 7.16%. The firm is considering establishing a production facility in Thailand. Markets worry about the increasing need for Tesla to cut prices. On Monday, Li Auto (LI) lost 13.6% while Xpeng (XPEV) lost 8%. Markets are taking profits in Li stock after the firm’s Q4 results. On Feb. 26, Li posted total deliveries nearly doubling (to 184.6%) Y/Y to 131,805 vehicles.

Li’s sell-off may have dragged TSLA stock lower. The Chinese EV manufacturer has a viable business yet shares continue to fall.

After markets closed, lithium supplier Albemarle (ALB) announced a $1.75 billion depositary share sale. Expect markets to dump ALB and Sociedad (SQM), another lithium miner.

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