Baiju Bhatt, Co-Founder and Co-CEO of Robinhood, discusses the challenges of running a startup and the future of cryptocurrencies.
Baiju Bhatt, Co-Founder and Co-CEO of Robinhood, discusses the challenges of running a startup and the future of cryptocurrencies.
Asian shares rallied on Monday while the dollar held near three-month peaks after the U.S. Senate passage of a $1.9 trillion stimulus bill augured well for a global economic rebound, though it also put fresh pressure on Treasuries. BofA analyst Athanasios Vamvakidis argued the potent mix of U.S. stimulus, faster reopening and greater consumer firepower was a clear positive for the dollar. "Including the current proposed stimulus package and further upside from a second-half infrastructure bill, total U.S. fiscal support is six times greater than the EU recovery fund," he said.
Taking out $66.92 could trigger an acceleration to the upside with the psychological $70 level the next upside target.
Confusion over building safety rules has left many people unable to move home without hard-to-obtain checks.
The direction of the April Comex gold market on Monday is likely to be determined by trader reaction to the major Fibonacci level at $1711.70.
(Bloomberg) -- Brent oil surged above $71 a barrel after Saudi Arabia said the world’s largest crude terminal was attacked, although output appeared to be unaffected after the missiles and drones were intercepted.Futures in London jumped as much as 2.9% after rising 4.9% last week. The kingdom said a storage tank at Ras Tanura in the country’s Gulf coast was targeted on Sunday by a drone from the sea. The terminal is capable of exporting roughly 6.5 million barrels a day -- nearly 7% of oil demand -- and, as such, is one of the world’s most protected installations.The assault follows a recent escalation of hostilities in the Middle East region after Yemen’s Houthi rebels launched a series of attacks on Saudi Arabia. The new U.S. administration has also carried out airstrikes in Syria last month on sites it said were connected with Iran-backed groups.Oil’s rally accelerated last week after Saudi Arabia and OPEC+ made a surprise pledge to keep output steady in April. The move prompted a raft of investment banks to raise their price forecasts, with Goldman Sachs Group Inc. estimating global benchmark Brent will top $80 a barrel in the third quarter.The broader market is also being supported by bullish Chinese export data and the outlook for U.S. stimulus. President Joe Biden is on the cusp of his first legislative win with the House ready to pass his $1.9 trillion Covid-19 relief plan, the second-biggest economic stimulus in American history.See also: Andurand Predicts Commodities Bull Run as Hedge Fund Soars 12%“It’s a perfect mix of bullish news at the moment,” said Warren Patterson, head of commodities strategy at ING Bank NV in Singapore. “It does seem that these attacks are picking up in frequency, so the market may need to price in some risk premium.”Brent’s prompt timespread at 70 cents a barrel in backwardation, a bullish market structure where the front-month contract trades higher than later shipments. It averaged 58 cents in backwardation last week.The Sunday attack is the most serious against Saudi oil installations since a key processing facility and two oil fields came under fire in September 2019, cutting oil production for several days and exposing the vulnerability of the Saudi petroleum industry. That assault was claimed by the Houthi rebels, although Riyadh pointed the finger at Iran.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
To win Senate passage, Biden agreed to make millions ineligible for the third checks.
(Bloomberg) -- It’s not just in meme stocks that the fate of short sellers is a key theme. Short bets are increasingly in vogue in the $21 trillion Treasuries market, with crucial implications across asset classes.The benchmark 10-year yield reached 1.62% Friday -- the highest since February 2020 -- before dip buying from foreign investors emerged. Stronger-than-expected job creation and Federal Reserve Chair Jerome Powell’s seeming lack of concern, for now, with leaping long-term borrowing costs have emboldened traders. In one telltale sign of which way they’re leaning, demand to borrow 10-year notes in the repurchase-agreement market is so great that rates have gone negative, likely part of a move to short the maturity.The trifecta of more fiscal stimulus ahead, ultra-easy monetary policy and an accelerating vaccination campaign is helping bring a post-pandemic reality into view. There are of course risks to the bearish bond scenario. Most prominently, yields could rise to the point that they spook stocks, and tighten financial conditions generally -- a key metric the Fed is focused on for guiding policy. Even so, Wall Street analysts can’t seem to lift year-end yield forecasts fast enough.“There’s a lot of tinder being put now on this fire for higher yields,” said Margaret Kerins, global head of fixed-income strategy at BMO Capital Markets. “The question is what is the point that higher yields are too high and really put pressure on risk assets and push Powell into action” to try and tamp them down.Share prices have already shown signs of vulnerability to increasing yields, especially tech-heavy stocks. Another area at risk is the housing market -- a bright spot for the economy -- with mortgage rates jumping.The surge in yields and growing confidence in the economic recovery prompted a slew of analysts to recalibrate expectations for 10-year rates this past week. For example, TD Securities and Societe Generale lifted their year-end forecasts to 2% from 1.45% and 1.50%, respectively.Asset managers, for their part, flipped to most net short on 10-year notes since 2016, the latest Commodity Futures Trading Commission data show.Auction PressureIn the days ahead, however, BMO is eyeing 1.75% as the next key mark, a level last seen in January 2020, weeks before the pandemic sent markets into a chaotic frenzy.A fresh dose of long-end supply next week may make short positions even more attractive, especially after record-low demand for last month’s 7-year auction served as a trigger to push 10-year yields above 1.6%. The Treasury will sell a total of $62 billion in 10- and 30-year debt.With expectations for inflation and growth taking flight, traders are signaling that they anticipate the Fed may have to respond more quickly than it’s indicated. Eurodollar futures now reflect a quarter-point hike in the first quarter of 2023, but they’re starting to suggest that it could come in late 2022. Fed officials have projected they’d keep rates near zero until at least the end of 2023.So while the market is leaning toward loftier yields, the interplay between bonds and stocks is bound to be a huge focus going forward.“There’s definitely that momentum, but the question is how well risky assets adjust to the new paradigm,” said Subadra Rajappa, head of U.S. rates strategy at Societe Generale. “We’ll be watching next week, when the dust settles after the payrolls data, how Treasuries react and how risky assets react to the rise in yields.”What to WatchThe economic calendarMarch 8: Wholesale trade sales/inventoriesMarch 9: NFIB small business optimismMarch 10: MBA mortgage applications; CPI; average weekly earnings; monthly budget statementMarch 11: Jobless claims; Langer consumer comfort; JOLTS job openings: household change in net worthMarch 12: PPI; University of Michigan sentimentThe Fed calendar is empty before the March 17 policy decisionThe auction calendar:March 8: 13-, 26-week billsMarch 9: 42-day cash-management bills; 3-year notesMarch 10: 10-year notesMarch 11: 4-, 8-week bills; 30-year bondsFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Is the market telling us that in the not too distant future, oil will no longer be sine qua non for Exxon, or even that Exxon will be driven out of business? Maybe to both, though not quite yet.
Personal finance guru Suze Orman said the receipt of a tax refund indicates "something's radically wrong," since the money returned to filers could otherwise have accrued value over the period it stood in the government's possession.
This week, investors will be eyeing new inflation data, which will offer a look at whether prices have already begun to creep up as some have feared ahead of a major economic reopening. A highly anticipated direct listing for the vide0 game company Roblox is also on deck.
(Bloomberg) -- Apple Inc. has slumped 15% since late January. Tesla Inc. has lost more than a quarter-trillion dollars in market value in three weeks. And more than $1.5 trillion has been wiped off the Nasdaq 100 in less than a month.And yet, none of it has been enough to rattle the retail investor.Instead, to borrow a Reddit phrase describing bullish gumption, they’ve had diamond hands. Since the market peaked a few weeks ago, retail traders have plowed cash into U.S. stocks at a rate 40% higher than they did in 2020, which was a record year. They’re opting for parts of the market that have suffered the most, doubling down in arguably risky ways with triple-leveraged tech funds and options galore.A year out from the Covid-19 stock crash, with individual traders now making up nearly a quarter of U.S. volume on any given day, battle lines are forming. Some of the favored speculative bets that minted money on the way up -- electric-vehicle stocks, special purpose acquisition companies and green energy plays to name a few -- are the same securities that are buckling now as bond yields rise.Retail traders, many of them newbie investors, have consistently held strong, buying virtually every dip during what’s been the best start to a bull market in nine decades. But now the world is wondering how much it’ll take for them to call it quits, especially after a year in which retail traders were right way more often than wrong.“Historically it’s been a bad signal that retail investors are piling into the market and a signal of a top,” said Arthur Hogan, chief market strategist at National Securities Corp. “And every time we tried to call a top in 2020 because of retail participation, it was wrong.”As stocks swooned over the last three weeks, retail investors snapped up an average of $6.6 billion in U.S. equities each week, according to data from VandaTrack, an arm of Vanda Research that monitors retail flows in the U.S. market. That’s up from an average $4.7 billion in net weekly purchases in 2020.They’ve doubled down on areas of the market that have been hit the hardest. Apple, which has plunged 15% since late January, was the most-popular retail buy this past week. NIO Inc., the electric-vehicle maker down almost 40% since Feb. 9, was the second-most popular. Next up were exchange-traded funds tied to the Nasdaq 100, the Invesco QQQ Trust Series 1 (ticker QQQ) and a triple leveraged version (ticker TQQQ).On Thursday, when the Nasdaq 100 fell as much as 2.9%, almost 32 million bullish call options traded across U.S. exchanges, the fifth-most on record. The other four have all occurred within the last four months.Equity ETFs added almost $7 billion of fresh money during the first four days of March, building on a record $83 billion that flooded in last month, data compiled by Bloomberg Intelligence show. In fact, even before March began, flows into U.S.-listed ETFs were off to their best start to a year on record, out-pacing the prior best start -- which was in 2017 -- by over 74%, according to Matt Bartolini, State Street Global Advisors’ head of SPDR Americas Research.“There’s a lot of excess liquidity and we just had this $600 check going to many families in January,” said Jimmy Chang, chief investment officer of Rockefeller Global Family Office. “We’re going to get an additional liquidity injection in the $1,400 check and part of that money is going into risk assets.”Karim Alammuri, a 31-year-old marketing strategy manager, is one of many retail investors who’s been snapping up stocks. In recent days, he bought shares of fuboTV Inc. and SPAC Churchill Capital Corp IV. Fubo TV has plunged more than 50% since a December peak. Churchill Capital has lost almost 60% of its value in 11 trading sessions.“I plan on sticking around because I don’t want to take a loss,” he said by phone from New York. “A lot of very attractive stocks are on crazy discount right now, so I’m just looking to see how I can re-shuffle things to be able to buy them.”With an army of retail investors standing ready to buy any dip, those declines have grown shallower and shallower. The S&P 500 has gone without a 5% pullback since early November, or 83 straight days, the longest streak in a year.The end result of persistent dip buying is a market with little downside. At its lowest closing level of 2021, the S&P 500 was only down 1.5% year-to-date. That’s the smallest drawdown at this time of a year since 2017.If past is precedent, that could mean the sell-off has more room to run. Retail investors tend to buy the initial dips, and it’s not until they capitulate and sell that markets ultimately bottom, according to Eric Liu, co-founder and head of research at Vanda Research. The firm’s data show that was the case in both selloffs in 2018, as well as roughly a year ago during the Covid crash.To Victoria Fernandez, chief market strategist for Crossmark Global Investments, their continued presence in the markets likely means elevated volatility will persist. Still, that doesn’t mean retail investors’ efforts are misguided.“Is there some dumb money in retail trades? Yes. But not all of it,” she said. “Some of these people are doing their homework, looking for opportunities and trying to take advantage of it. Some win, some lose -- it’s really not that different than what professionals do on an institutional basis.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
U.S. energy firms this week added oil and natural gas rigs for a second week in a row as crude prices soared to their highest levels since 2019.
(Bloomberg) -- Brent crude now trades above fiscal breakeven prices for the four biggest oil producers in the Middle East after Saudi Arabia convinced fellow OPEC+ members to keep output largely unchanged.The shock move by OPEC+ triggered a rally in Brent prices, which rose to almost $70 a barrel. That’s higher than annual average levels needed for the cartel’s largest producers, including Saudi Arabia, to balance their budgets this year.If oil prices stay at current levels, “we would see fiscal surpluses for the larger Gulf Cooperation Council economies,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank. “This provides more fiscal space to support economic activity and recovery.”Analysts at Goldman Sachs Group Inc. and JPMorgan Chase & Co. raised their price forecasts for Brent after the OPEC decision, while Citigroup Inc. said crude could top $70 before the end of this month.Budget deficits in the Arab Gulf, where economies are reliant on oil, widened after prices crashed in 2020. OPEC+ agreed last year to take about 10% of global supply off the market to stem the plunge and while the group has slowly rolled back some of those cuts, it is curtailing more than 7 million barrels of daily production.Still, Brent prices have averaged just over $59 so far this year -- below the breakeven level for most gulf countries. Saudi Arabia, the Arab world’s largest economy and OPEC’s biggest producer, has posted successive budget shortfalls in the past seven years, a trend expected to continue into 2024, according to projections from the International Monetary Fund.Despite higher oil prices, “key non-oil sectors will continue to be impacted by the pandemic,” Malik said. “It will also be a balancing act for oil producers to manage the tightening in the oil market, whilst not halting the global recovery outlook.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
And will you even get a payment this time, under the new limits the president agreed to?
Congress is nearing passage of the third economic stimulus check it will send out to you and other taxpayers as part of its Covid-19 relief bill.
The bill that passed the Senate makes payments harder to get. Your tax return might help.
ARK Investment founder Cathie Wood says her new Tesla price target is coming soon. What will it be? Barron's hazards a back-of-the-envelope guess.
Class-action suits contend that insurers have been unfairly profiting from emptier roads.
“Over 85% of American households will get direct payments of $1,400 per person,” Biden said over the weekend.
It’s time to check in with the macro picture, to get an idea of just where markets are headed in the coming months. That’s what a JPMorgan global research team, headed up by Joyce Chang, has been doing. The JPM team starts by noting the sell-off in US Treasury bonds last week, pushing up yields as investors acted in response to inflationary fears. However, the rise in bond yields steadied on Friday, and Chang’s team does not believe that inflation is the great bugaboo it’s made out to be; her team sees a combination of economic growth and fiscal stimulus creating a virtuous circle of consumer spending fueling more growth. They write, “Our global economics team is now forecasting US nominal GDP to average roughly 7% growth over this year and next as targeted measures have been successful in addressing COVID-19 and economic activity is not being jeopardized. Global growth will exceed 5%...” What this means, in JPM’s view, is that the coming year should be good for stocks. Interest rates are likely to remain low, in the firm’s estimation, while inflation should moderate as the economy returns to normal. JPM’s stock analysts have been following the strategy team, and seeking out the stocks they see as winners over the next 12 months. Three of their recent picks make for an interesting lot, with Strong Buy ratings from the analyst community and over 50% upside potential. We’ve used the TipRanks database to pull the details on them. Let’s take a look. On24 (ONTF) The first JPM pick were looking at here is On24, the online streaming service that offers third parties access for scaled and personalized networked events. In other words, On24 makes its streaming service available for other companies to use in setting up interactive features, including webinars, virtual events, and multi-media experiences. The San Francisco-based company boasts a base of more than 1900 corporate users. On24’s customers engage online with more than 4 million professionals every month, for more than 42 million hours every year. As can be imagined, On24 saw a surge of customer interest and business in the past year, as virtual offices and telecommuting situations expanded – and the company has now used that as a base for going public. On24 held its IPO last month, and entered the NYSE on February 3. The opening was a success; 8.56 million shares were put on the market at $77 each, well above the $50 initial pricing. However, shares have taken a beating since, and have dropped by 36%. Nevertheless, JPM’s Sterling Auty thinks the company is well-placed to capitalize on current trends. “The COVID-19 pandemic, we believe, has changed the face of B2B marketing and sales forever. It has forced companies to move most of their sales lead generation into the digital world where On24 is typically viewed as the best webinar/webcast provider.” the 5-star analyst wrote. “Even post-pandemic we expect the marketing motion to be hybrid with digital and in-person being equally important. That should drive further adoption of On24-like solutions, and we expect On24 to capture a material share of that opportunity.” In line with these upbeat comments, Auty initiated coverage of the stock with an Overweight (i.e., Buy) rating, and his $85 price target suggests it has room for 73% upside over the next 12 months. (To watch Auty’s track record, click here.) Sometimes, a company is just so solid and successful that Wall Street’s analysts line up right behind it – and that is the case here. The Strong Buy analyst consensus rating is unanimous, based on 8 Buy-side reviews published since the stock went public just over a month ago. The shares are currently trading for $49.25 and their $74 average price target implies an upside of 50% from that level. (See On24’s stock analysis at TipRanks.) Plug Power, Inc. (PLUG) And moving over to the reusable energy sector, we’ll take a look at a JPM ‘green power’ pick. Plug Power designs and manufactures hydrogen power cells, a technology with a great deal of potential as a possible replacement for traditional batteries. Hydrogen power cells have potential applications in the automotive sector, as power packs for alt-fuel cars, but also in just about any application that involves the storage of energy – home heating, portable electronics, and backup power systems, to name just a few. Over the past year, PLUG shares have seen a tremendous surge, rising over 800%. The stock got an additional boost after Joe Biden’s presidential election win – and his platform promises to encourage ‘Green Energy.” But the stock has pulled back sharply recently, as many over-extended growth names have. Poor 4Q20 results also help explain the recent selloff. Plug reported a deep loss of $1.12 per share, far worse than the 8-cent loss expected, or the 7-cent loss reported in the year-ago quarter. In fact, PLUG has never actually reported positive earnings. This company is supported by the quality of its technology and that tech’s potential for adoption as industry moves toward renewable energy sources – but we aren’t there yet, despite strides in that direction. The share price retreat makes PLUG an attractive proposition, according to JPM analyst Paul Coster. “In the context of the firm's many long-term growth opportunities, we believe the stock is attractively priced at present, ahead of potential positive catalysts, which include additional ‘pedestal’ customer wins, partnerships and JVs that enable the company to enter new geographies and end-market applications quickly and with modest capital commitment,” the analyst said. “At present, PLUG is a story stock, appealing to thematic investors as well as generalists seeking exposure to Renewable Energy growth, and Hydrogen in particular.” Coster’s optimistic comments come with an upgrade to PLUG’s rating - from a Neutral (i.e., Hold) to Overweight (Buy) - and a $65 price target that indicates a possible 55% upside. (To watch Coster’s track record, click here.) Plug Power has plenty of support amongst Coster’s colleagues, too. 13 recent analyst reviews break down to 11 Buys and 1 Hold and Sell, each, all aggregating to a Strong Buy consensus rating. PLUG shares sell for $39.3 and have an average price target of $62.85, which suggests a 60% one-year upside potential. (See Plug’s stock analysis at TipRanks.) Orchard Therapeutics, PLC (ORTX) The last JPM stock pick we’ll look at is Orchard Therapeutics, a biopharma research company focused on the development of gene therapies for the treatment of rare diseases. The company’s goal is to create curative treatments from the genetic modification of blood stem cells – treatments which can reverse the causative factors of the target disease with a single dosing. The company’s pipeline features two drug candidates that have received approval in the EU. The first, OTL-200, is a treatment for Metachromatic leukodystrophy (MLD), a serious metabolic disease leading to losses of sensory, motor, and cognitive functioning. Strimvelis, the second approved drug, is a gammaretroviral vector-based gene therapy, and the first such ex vivo autologous gene therapy to receive approve by the European Medicines Agency. It is a treatment for adenosine deaminase deficiency (ADA-SCID), when the patient has no available related stem cell donor. In addition to these two EU-approved drugs, Orchard has ten other drug candidates in various stages of the pipeline process, from pre-clinical research to early-phase trials. Anupam Rama, another of JPM’s 5-star analysts, took a deep dive into Orchard and was impressed with what he saw. In his coverage of the stock, he notes several key points: “Maturing data across various indications in rare genetic diseases continues to de-risk the broader ex vivo autologous gene therapy platform from both an efficacy / safety perspective… Key opportunities in MLD (including OTL-200 and other drug candidates) have sales potential each in the ~$200-400M range… Importantly, the overall benefit/risk profile of Orchard’s approach is viewed favorably in the eyes of physicians. At current levels, we believe ORTX shares under-reflect the risk-adjusted potential of the pipeline...” The high sales potential here leads Rama to rate the stock as Outperform (Buy) and to set a $15 price target, implying a robust 122% upside potential in the next 12 months. (To watch Rama’s track record, click here.) Wall Street generally is in clear agreement with JPM on this one, too. ORTX shares have 6 Buy reviews, for a unanimous Strong Buy analyst consensus rating, and the $15.17 average price target suggests a 124% upside from the current $6.76 trading price. (See Orchard’s stock analysis at TipRanks.) Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.