This week Coca-Cola’s CEO stated that he sees sequential improvement as more economies recover from the pandemic. The latest earnings showed that Coca-Cola’s EPS was 0.68 vs the expected 0.58 and the revenue was up 10.1 bln from an expected 9.32bln. Furthermore, the forward guidance for the full year was increased 13-15%. Coca-Cola tends to see seasonal demand as soft drink beverages are more consumed during warmer summer months.
Over the last 14 years, Coca-Cola has risen a total of 11 times between July 23 and September 18 with an average return of +1.77%. The largest gain was in 2009 with a 9.31% gain.
Major Trade Risks: If the Fed announces that they are starting to consider bond tapering next week, watch out for a correction in stocks. This is a key risk right now even though markets are still expecting the Fed to remain dovish until there are sufficient signs of a recovery in the US labour market.