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2022-02-03 17:12:19 If you were hoping for calm before Thursday’s Bank of England and European Central Bank meetings, forget it.

U.S. stock futures are down sharply in early London trade — Nasdaq futures are sliding 2% with tech stocks globally in the doldrums.

Facebook owner Meta Platforms Inc’s shares plunged more than late on Wednesday after posting weaker-than-expected forecasts. In Japan, Sony and Panasonic shares fell over 6%, while stock futures point to a weak open in Europe.

That’s all before the BoE looks set to hike its key rate 25 basis points to 0.5% — the threshold at which it has said it will start unwinding its 895 billion pound ($1.2 trillion) quantitative easing programme.

For some, markets are underestimating the risks of so called quantitative tightening, QT for short. Others note the BoE’s ability to surprise, noting November when markets were positioned for a rate hike and the BoE left rates unchanged and then December, when markets expected no move and the BoE hiked.

@TransAmericanFriendship Open / Comment

2022-02-01 23:04:15 After the Crash — How to Buy Tech Stocks as Rates Begin to Rise?

Tech stocks finally showed a little fight last week, aided by an impressive batch of earnings reports. But the sector remains battered. The Nasdaq Composite is down 16% over the past two months—and beneath the surface, the damage is considerably worse. Among Nasdaq stocks with market caps over $1 billion, one-quarter are down 30% or more since mid-November. More than 60 Nasdaq stocks are down 50%-plus, including familiar names like Overstock, Affirm, Robinhood, DocuSign, and Etsy.

While stock prices are a lot lower, they are hardly de-risked. As the Federal Reserve made clear last week, rate increases are coming, likely by March. Higher rates are bad for the kind of high-multiple growth stocks that led the market over the past two years.

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2022-02-01 23:02:14 Tuesday, Feb. 1 – Gold Gets Back Above the $1,800 Level

Gold is 0.7% higher this morning, as it is trading above the $1,800 price level again. What about the other precious metals?

The gold futures contract gained 0.55% on Monday, Jan. 31, as it retraced its Friday’s decline of 0.5%. The market got back to the $1,800 price level again. Recently it reacted to the strengthening U.S. dollar after last week’s Wednesday’s FOMC Statement release. Earlier, gold fluctuated along the $1,850 level after breaking above the previous short-term consolidation. On Wednesday, the market came back to that previous trading range and it got closer to the $1,800 level again, and on Thursday it fell below that support level. This morning yellow metal is trading higher after breaking above the $1,800 level.

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2022-02-01 15:35:50 Bitcoin Market Predictions for 2025

Bitcoin is the pioneer cryptocurrency. Thanks to the first move advantage, it also happens to be the most popular and valuable digital token. However, the market share of the Satoshi coin has declined to less than half from over 70% market share in past years.

The price movement of Bitcoin is a rollercoaster of surprises, from the bull run of 2017 to the great crypto crash. But 2021 is among the most instrumental to the digital token since its inception in 2019. The crypto started the year with a bull run and eventually hit an all-time high of $64,000 in May. The bearish move has seen it dip to $36,000.

So will Bitcoin will tumble further, or will it hit the $100,000 mark?

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2022-01-31 15:28:41 Market corrections are good buying opportunities, says Goldman Sachs — but only when this happens

A January that is set to be the worst in more than a decade is nearly in the books. So what now?

The first point is that corrections are not uncommon. Since 1928, there have been corrections greater than 10% during 62% of years. 2021 was unusual since the biggest drawdown was just 5%.

The bad news is the S&P 500 SPX, +2.43% typically falls by an average of 15% peak-to-trough during the 21 non-recession corrections since 1950. There would be more selling to come, given the S&P 500 has only dropped 10% from its Jan. 3 peak.

The good news is that S&P 500 corrections are typically good buying opportunities. Of the 33 corrections of at least 10% since 1950, the median episode has lasted about five months, and encompassed a peak-to-trough decline of 18% — but an investor buying the S&P 500 10% below its high would’ve gained a median return of 15% during the subsequent 12 months.

@TransAmericanFriendship Open / Comment

2022-01-31 15:22:03 Brace Yourself For Another Wild Month In Stock Markets

For the year, the Dow is down -6%, the S&P 500 is down just over -9%, and the Nasdaq has lost -14.7%. The previous record-holder is January 2009, an ugly moment for the economy, when the stock market fell -8.6%. In addition, the VIX – aka the CBOE Volatility Index – has actually dropped back to around 31 after topping 37 earlier this week, its highest point since November 2020.

Keep in mind, the index isn’t registering anywhere close to levels reached during other periods of “extreme” volatility. For example, the index, which is measured between zero and 100, hit its highest point of almost 83 during the financial crisis in 2008. Its most extreme point during the pandemic was around 66 in March 2020. So, by comparison, this week’s volatility has been rather mild.

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2022-01-29 14:10:11 Australia seeks to join WTO talks on China-E.U. trade row

Australia will seek to be included in consultations over a trade dispute between the European Union and China that the E.U. launched at the World Trade Organisation, the Australian trade minister said on Saturday.

“Australia has a substantial interest in the issues raised in the dispute brought by the European Union against China … and will request to join these consultations,” Trade Minister Dan Tehan said in a statement.

Relations between Australia and China, its top trade partner, soured after Canberra banned Huawei Technologies from its 5G broadband network in 2018, toughened laws against foreign political interference, and urged an independent investigation into the origins of COVID-19.

Beijing responded by freezing ministerial contacts and imposing tariffs on several Australian commodities, such as coal, beef, barley and wine.

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2022-01-28 19:57:13 Stocks mixed as inflation rises by most since 1982

Stocks traded lower Friday as investors took in earnings results from some major tech companies and another hot print on inflation at the end of another volatile week.

The S&P 500 and Nasdaq turned lower. The Dow dipped, even as component stock Apple (AAPL) jumped after the iPhone-maker reported record quarterly sales and better-than-expected profits despite supply chain challenges.

Fresh economic data was also in focus on Friday. The latest inflation data showed another multi-decade high rate of price increases, as the Personal Consumption Expenditures (PCE) index posted a 5.8% year-over-year rise in December, or the biggest jump since 1982. Core PCE, which excludes more volatile food and energy prices, rose at a 4.9% annual rate, representing the largest leap since 1983.

The S&P 500 was on track to post a weekly loss of about 1.3%, based on Thursday's closing prices. The Dow and Nasdaq have each also fallen over the course of the past week. Open / Comment

2022-01-27 17:48:50 U.S. economy grew 6.9% in fourth quarter, GDP shows, as businesses restocked and consumers boosted spending

The U.S. economy sped up toward the end of 2021 before a late omicron surge, expanding at an annual 6.9% pace for the quarter as consumers spent more and businesses stocked back up.

Economists polled by The Wall Street Journal had forecast gross domestic product to rise by 5.5% in the fourth quarter. GDP grew a slower 2.3% in the third quarter. The figures are adjusted for inflation.

GDP got a big lift at the end of last year from frantic efforts by businesses to restock barren shelves and warehouses hit by disruptions during the pandemic and in time for the holiday season. The economy grew a lot more slowly if the inventory buildup is set aside.

The U.S. economy expanded 5.7% in 2021 to mark the fastest growth since 1984.

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2022-01-26 20:31:39 The House of Cards Is Going to Collapse — Buy Physical Gold Now !

The big problem with fiat money – government-issued currency not backed by a physical commodity – is that it is largely based on public faith in the issuer.

Put simply, it has no real value. Instead, its value is born out of trust and confidence in the government that issues it and the wider national economy.

And in times of certainty when confidence in the government is high, fiat more or less serves the needs of the financial system. However, when the ‘house of cards’ as Robert Kiyosaki keenly puts it, comes tumbling down during unprecedented economic times, we need to reconsider how we store our wealth.

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