Shares are poised to boost Monday’s rebound, which followed the worst week of U.S. equities since October. We will once again focus on big profits, with e-commerce giant Amazon AMZN,
and Google Alphabet GOOGL,
expired after the market closed.
Our call of the day comes from two Wall Street banks, JPMorgan and Goldman Sachs, who don’t seem too concerned about the recent stock losses that have been fueled by the fierce battle between retail investors – demanded by WallStreetBets, deputy director of Reddit – and the hedging fund on short shares. as the video game retailer GameStop GME,
In a note to clients, London-based strategists JPMorgan Cazenove, led by Mislav Matejka, acknowledge that recent equity declines have fueled concerns about potentially larger losses and acknowledge a “healthy skepticism towards the hearts of experts who they immediately declared a purchase opportunity “.
“While there are likely key drivers, not just technicians, behind the weakness that could persist, we believe these barriers may not be in place for a long time,” says the JPMorgan team, in a note to customers.
As for the obstacles, Matejka and her teammates. they say concerns about the foaming liquidity spreading in the markets have been boiling for a while, with some tactical indicators seeming to be stretched. But these have calmed down and it seems that this small push fueled by retailers is on its way.
Read: How will this wild GameStop saga end? The ghosts of past commercial catastrophes offer clues
“Below the surface, consolidation was underway for two months, with a value / momentum down from 9% in Europe and up to 15% in the US since early December. The excess is eliminated, which leads to a better starting point.
In addition, a technical signal could be ready to favor the bulls. “100% of the time you publish the VIX VIX,
peak, as seen last week, stocks would be higher for 1 and 6 months, outside of recessions, ”the team says, referring to the Cboe volatility index, a measure of the expected S&P 500 SPX ,
volatility over the next 30 days.
On the fundamental side, JPMorgan says the market appears ready to look at headwinds, such as a stronger dollar, stop bond yields and mixed gains, and focus on the likely rebound in economic activity in the March-April. The team sees risk assets increase during the first half of the year.
Meanwhile, at Goldman, a team of strategists led by Alessio Rizzi says that, despite recent market turmoil, it is unlikely that there will be a “big development in November earnings.” In favor of stocks: an improved market environment driven by COVID-19 vaccines, US stimulus and largely unaltered macro prospects.
“As a result, we believe that the risk of a bear market over the next year is quite low. Although uncertainty remains high in the short term given that some of the positioning metrics, such as leverage of funds of coverage, continue to be high, the recent market turbulence has not changed our constructive view on pro-cyclical assets for the rest of 2021, ”say strategists.
Note that GameStop is down another 20% in premarket after losing 31% on Monday, as some say a piece of short positions has been eliminated. A look at WallStreetBets this morning shows that there are still many posters activated.
Read: Hey, Robinhood traders – these “bubble-free” stocks can also be good bets for you
The markets
US stock futures ES00,
YM00,
NQ00,
they increase after Monday’s strong session. SXXP European actions are also escalating,
and Asian markets had an optimistic day. Meanwhile, SIH21 silver prices,
they retire from eight-year highs after the Chicago Mercantile Exchange raised margin requirements for futures contracts.
The buzz
Pfizer PFE Pharmaceutical Company,
and Alibaba BABA e-commerce group,
they are among a lot of companies that report before opening. Actions of the motorcycle manufacturer Harley-Davidson HOG,
sink after a surprise loss, while UPS UPS,
increases in optimistic results. Along with Amazon, the burrito giant Chipotle CMG,
and manufacturer of video games Electronic Arts EA,
will report after closing.
McDonald’s fast food giant MCD,
reportedly has been testing its new pea-based McPlant burger: Beyond Meat BYND provides this pie,
– in Denmark and Sweden.
Meeting with Republicans on Monday, President Joe Biden said he would not agree to a reduced version of his proposed $ 1.9 trillion package.
Good news milestone: vaccines in the U.S. are roughly equal to the total number of COVID-19 cases.
The tweet
Here’s why some think Tesla’s CEO takes a Twitter TWTR,
to breathe.
Read: SpaceX will fly four space tourists at the end of the year
Random readings
Singer-songwriter Dolly Parton explained why she twice turned down President Donald Trump’s offer of the Medal of Freedom.
National Basketball Association legend LeBron James against “a Karen court.”
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