A modest recovery appears to be underway after Monday’s setback, as hope eternally comes out for a new stimulus from President-elect Joe Biden’s administration. And why should the market stop doing what it did a long time ago? Bounce again and again.
But are there problems in paradise? “The ability of the equity market to concentrate decisively in the face of the tragic events of 1/6 of the Capitol, the escalation of the virus, a poor employment report and rising yields confirm that a new phase more speculative and more volatile in the bullish market has begun, ”explains in a note BTIG’s chief derivatives and derivatives strategist Julian Emanuel, and equity strategy associate Michael Chu.
“This phase lasted more than six months in 1999-2000, as the S&P 500 advanced 25% more, with several sales of 15%. The depth of these setbacks in 2021 depends largely on yields,” they say. . And if yields continue to rise, as they did Monday, high multiple-growth names could have problems, they say.
They also provide ours call of the day, and zero in one sector, say investors may want to set aside the future.
Last month, they warned that communications and media actions face risks from higher rates, greater regulatory control and “a world tired of years of excessive media consumption.”
Emanuel and Chu update these views on Tuesday: “President Trump’s resignation will naturally reduce media appetite, as will the reopening of the economy and the possible return of travel and leisure activities.” the screen “.” This and recent moves to restrict access to content providers and platforms by Alphabet GOOGL,
Apple AAPL,
Facebook FB,
and Twitter TWTR,
it can only inspire politicians to seek more oversight over them.
There is also the issue of investors shifting towards value and moving away from growing stocks, which would be supported in the communications sector.
Here is the list of S&P 1500 communications service stocks that have surpassed their broadest index since late 2019, but will go from “leaders to laggards, as politicians pay more attention to the media, while the rest we pay less attention to ”.
Stocks mentioned above include Facebook, Disney DIS,
Netflix NFLX,
the New York Times NYT,
and the publisher of MarketWatch, which produces this report, News Corp. NWSA,
NWS,
The final word goes to Howard Marks, co-founder and co-chair of Oaktree Capital Management. In his latest newsletter, he explains in detail how investors may not be looking closely at this growth versus value strategy.
“Some of the current high valuations are probably more than justified by future prospects, while others are ridiculous, just as some companies with low valuations may face imminent demise, while others they are momentarily deteriorating, ”he says. Read more here.
The markets
US stock futures ES00,
YM00,
NQ00,
are modestly superior, but the European shares SXXP,
have fallen as concerns about COVID-19 infection increase. Asian stocks have ended up on the rise. The performance of the 10-year Treasury note TMUBMUSD10Y,
continues to rise after the biggest weekly rise since June last week.
Bitcoin BTCUSD,
volatility continues, with the cryptocurrency up 8% after falling between Sunday and Monday.
The buzz
American small business sentiment fell to a seven-month low in December. The results of the employment and workload surveys are also ahead.
German lender Deutsche Bank DB,
has reportedly halted deals with President Donald Trump and the New York Signature Bank SBNY,
he demands his resignation, after he also said he would no longer do business with him after last week’s riots on Capitol Hill. Trump tried to blame those attacks last week on “antifa people,” Axios reported, citing a tense phone call between him and the house’s minority leader Kevin McCarthy, who said no, was “MAGIC.” I know. I was there. ”
Zoom Video ZM Actions,
they have fallen after the communications technology company said it was selling $ 1.5 billion in shares.
SolarWinds SWI Network Management Software Group
he says he has found the source of the recent cyberattacks.
Some Democratic lawmakers say they tested positive for COVID-19 while taking refuge with comrades who refused to wear masks during last week’s riots on Capitol Hill.
Walmart WMT Retailer,
will start its own financial technology company for clients and employees with support for the Robinhood investment platform.
The graph
Here’s a look at how COVID-19 is progressing in the United States, with deaths and cases off their highs.
Random reading
Spy. Is Angelina Jolie anything more than an actress?