Feb.18 -- Rep. Gregory Meeks, a Democrat from New York, asks Robinhood Markets CEO Vlad Tenev how he justifies allowing customers to buy stocks on margin. Tenev speaks before a House Financial Services Committee hearing.
Feb.18 -- Rep. Gregory Meeks, a Democrat from New York, asks Robinhood Markets CEO Vlad Tenev how he justifies allowing customers to buy stocks on margin. Tenev speaks before a House Financial Services Committee hearing.
Japan's Mizuho Bank stopped service at some of its automated teller machines (ATMs) on Sunday after the machines devoured customers' cash cards and bank books. The core banking unit of Mizuho Financial Group announced the halt on its website in red letters, switching from the standard black used for previous updates of the problem. "Due to a system failure, ATM service has been halted at some of our branches," said Japan's third-largest lender by assets, with a history of system woes stretching more than a decade.
Brazos Electric Power Cooperative Inc is one of dozens of electricity providers facing enormous charges stemming from a severe cold snap last month. The fallout threatens utilities and power marketers who collectively face billions of dollars in blackout-related charges, executives said. Brazos and others that committed to provide power to the grid and could not, were required to buy replacement power at high rates and cover other firms' unpaid fees.
Americans could get $1,400 more from Uncle Sam — and many won't know what to do with it.
The payments in President Biden's COVID relief plan will rely on an IRS formula.
Berkshire Hathaway Inc (NYSE: BRK-A) (NYSE: BRK-B) CEO Warren Buffett over the weekend wrote his annual letter to shareholders and highlighted the “power of repurchases” using Apple Inc (NASDAQ: AAPL) as an example. What Happened: Buffett said that Berkshire began buying shares of the iPhone maker in late 2016 and by early June 2018 owned more than one billion shares (adjusted for splits). “Saying that, I’m referencing the investment held in Berkshire’s general account and am excluding a very small and separately-managed holding of Apple shares that was subsequently sold. When we finished our purchases in mid-2018, Berkshire’s general account owned 5.2% of Apple,” wrote the veteran investor. The cost for acquiring that stake was $36 billion and since then Berkshire has enjoyed regular dividends averaging about $775 million annually and has pocketed an extra $11 billion in 2020 by selling a small part of its holdings. The continuous repurchase of shares by Apple and the consequent shrinking number of shares outstanding has meant that Berkshire now owns 5.4% of the Tim Cook-led company. “That increase was costless to us,” wrote Buffett. Why It Matters: Berkshire’s third-quarter operating profits declined 32% to $5.48 billion from $8.07 billion a year ago. The company repurchased .3 billion worth of stock in the period. Since Berkshire also repurchased its own shares during the past two and a half years, its shareholders now own a full 10% more of Apple’s assets and future earnings than they did in July 2018, wrote Buffett. “This agreeable dynamic continues. Berkshire has repurchased more shares since yearend and is likely to further reduce its share count in the future,” revealed the Oracle of Omaha. Buffett also pointed to Apple’s publicly stated intention to repurchase shares and thus Berkshire shareholders would find “their indirect ownership of Apple increasing as well.” This year the Buffet-led company cut its position in Apple by 6% to 887 million shares in the latest quarter but upped stakes in AbbVie Inc (NYSE: ABBV), Bristol-Myers Squibb Company (NYSE: BMY), and Merck & Co, Inc (NYSE: MRK). Apple still remains the single largest investment in Berkshire’s portfolio. Price Action: Berkshire Class A shares closed nearly 0.9% lower at $364,580 on Friday. On the same day, the company’s Class B shares closed 1.3% lower at $240.51. Apple shares closed almost 0.2% higher at $121.26 and fell 0.41% in the after-hours session. Photo courtesy: Freeimage4life via Flickr. See more from BenzingaClick here for options trades from BenzingaApple To Offer 1TB Storage Option In iPhone 13: ReportTop 10 Electric Vehicle Stocks You Should Know About© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Bitcoin rose nearly 6% on Monday as risk assets rallied after last week's bond rout cooled, and Citi said the most popular cryptocurrency was at a "tipping point" and could become the preferred currency for international trade. With the recent embrace of the likes of Tesla Inc and Mastercard Inc, Bitcoin could be at the start of a "massive transformation" into the mainstream, Citi added.
The US Small Business Administration (SBA) is expected to issue a rule as soon as Monday that will make loans from the Paycheck Protection Program (PPP) more generous for business owners without employees. Companies and nonprofits without employees have always been eligible for PPP loans. The new rule expected from the SBA will instead base loan amounts off of sole proprietors’ gross income, significantly expanding the amount of money for which they are eligible.
When you buy $1,000 of a company’s stock in your Robinhood account, how much of that cash goes directly to help fund the company and its business operations? The answer is $0. Where Your Cash Goes: The issue of buying shares of stock to help “save” struggling companies like GameStop Corp. (NYSE: GME) and AMC Entertainment Holdings Inc (NYSE: AMC) has come up frequently on social media since the WallStreetBets-fueled meme stock buying frenzy began in January. However, experienced investors know that publicly traded companies don’t get a dime from the cash you spend buying their shares of stock. Related Link: Kevin O'Leary Of 'Shark Tank,' Benzinga CEO Jason Raznick Talk GameStop, Bitcoin And Economic Recovery Trades Companies typically raise cash in the public market when they first go public via an initial public offering (IPO), a merger with a special acquisition company (SPAC) or a direct listing. However, once their shares are trading on the public market, any shares you buy in your brokerage account are coming directly from another shareholder who is selling, not the company itself. Aside from any trading fees you may spend on the transaction, every dollar you spend buying shares of GameStop, AMC or other stocks ends up in the brokerage account of the person or institution that sold them to you. AMC and GameStop traders on Reddit and Twitter have been celebrating their efforts to “save” these companies by buying shares of stock. In reality, the companies haven’t gotten any funds from any of the recent stock buying. How Public Companies Raise Funds: Once a company is public, it must raise capital via options such as a follow-on public offer (FPO), also known as a secondary offering. FPOs can be both dilutive or non-dilutive. A non-dilutive FPO happens when the founders or other large shareholders sell some of their shares to the public. An FPO may increase a stock’s float, or free-trading shares, but it does not increase the company’s outstanding shares or decrease its EPS. See also: How to Buy Stocks A dilutive FPO happens when a company creates new shares to sell to the public. By creating new shares, the ownership stakes of existing shareholders are decreased slightly the same way the value of a currency erodes when central banks print more money. Companies can also raise capital by borrowing money. However, the company must first find a lender that will agree on a reasonable interest rate. Many lenders don’t want to touch struggling companies like AMC and GameStop because they aren’t convinced they will be able to pay back their debts. What It Means For Meme Stocks: Despite all the publicity and wild volatility in GameStop, the company itself hasn’t actually been directly helped by all the retail buying. GameStop reportedly considered selling more shares during the January rally, but the SEC has said it would closely scrutinize any company that attempted to take advantage of the extreme trading volatility to knowingly sell overpriced shares to vulnerable investors. In June 2020, bankrupt Hertz Global Holdings Inc (OTC: HTZGQ) withdrew a proposed $500 million equity offering after the SEC cracked down on the company for potentially preying on investors. AMC, on the other hand, was able to raise $1.2 billion via debt and equity deals in January after its stock rallied more than 700%. “The irony here, of course, is that GME couldn’t even tap equity markets to take advantage of the recent short squeeze,” DataTrek Research co-founder Nicholas Colas said this week. He said the so-called “dumb money” flowing into the market may not be helping the companies directly, but it is certainly making short sellers think twice. “You don’t have to be long, but betting against people who think their 10-share buy order is going to change the world is both risky and not actually a fundamentally-based investment position,” Colas said. Benzinga’s Take: GameStop hasn’t been helped directly by all the retail stock buying, but investor enthusiasm and a higher stock price definitely help more than it hurts. If GameStop can now demonstrate its army of new investors and its massive amount of free publicity has translated into improved sales and earnings numbers, the company may have several funding options open up in the near future. GameStop reports fourth-quarter earnings in late March. Photo by Sharon McCutcheon on Unsplash. Latest Ratings for GME DateFirmActionFromTo Jan 2021B of A SecuritiesMaintainsUnderperform Jan 2021Telsey Advisory GroupDowngradesOutperformUnderperform Oct 2020JefferiesDowngradesBuyHold View More Analyst Ratings for GME View the Latest Analyst Ratings See more from BenzingaClick here for options trades from BenzingaWhy GameStop Stock Traders Should Beware The 'Law Of Twos And Threes'Kevin O'Leary Of 'Shark Tank,' Benzinga CEO Jason Raznick Talk GameStop, Bitcoin And Economic Recovery Trades© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
(Bloomberg) -- The Philippine peso has been under siege from rising Treasury yields and buoyant crude prices. But technicals may offer some support.The peso slumped to its lowest level in six months last week following an extension of coronavirus-led curbs in the nation and delays in vaccine rollouts. The 10-year Treasury yield’s surge to 1.6% added to the bearish sentiment.Still, losses have been limited to near the dollar-peso’s 200-day moving average so far, spurring hopes that the barrier may hold at least in the near term. The pair’s relative strength index, a momentum indicator, is in the overbought territory, providing further support to the Philippine currency.Still, expectations that U.S. yields will rise further is keeping sentiment cautious toward the peso. Especially after the rout in emerging market assets on Friday brought back memories of the 2013 taper tantrum among investors.“How U.S. yields evolve from here and the broad USD picture will be the key driver of USD/PHP,” said Irene Cheung, a currency strategist at Australia & New Zealand Banking Group Ltd. She sees the peso at 48.30 per dollar at the end of the quarter.The peso is among Southeast Asia’s worst performing currencies this year. It’s declined 1.1% in February to 48.59 as global funds sold $171 million of Philippine stocks during this period.Inflation FocusTechnical factors supporting the peso are likely to come into focus once again on Friday, when February inflation data is due. If price pressures quickened, this could erode the nation’s real yields and weigh on the currency.Comments from Bangko Sentral ng Pilipinas Governor Benjamin Diokno that the rise in the nation’s consumer prices is temporary will also be put to the test. A Bloomberg survey forecasts inflation quickened to 4.8% in February, which would be the fastest since December 2018.“Rising inflation has pushed Philippines’ real rates into the negative territory,” said Divya Devesh, head of Asean and South-Asia currency research at Standard Chartered Bank in Singapore. “Depressed real rates and elevated real effective exchange rate is a negative for the PHP,” he said, adding that the peso may fall toward 49.50 per dollar this year.Below are the key Asian economic data and events due this week:Tuesday, March 2: RBA policy decision, Australia building approvals and 4Q BoP current account balance, net exports of GDP, New Zealand 4Q terms of trade, Japan jobless rate and 4Q capita spending, South Korea industrial productionWednesday, March 3: Australia 4Q GDP, New Zealand building permits, China Caixin services PMIThursday, March 4: Australia retail sales and trade balance, RBNZ Governor. Orr speaks, South Korea CPI and 4Q GDP, BNM policy decision, Thailand consumer confidenceFriday, March 5: New Zealand 4Q volume of all buildings, Philippine CPI, Singapore retail sales, Thailand CPI(Corrects analyst forecast for peso in ninth paragraph and clarifies peso move in sixth paragraph was for February.)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.
(Bloomberg) -- As interest-rate jitters supercharged a meltdown in the world’s biggest bond market, Sam Sicilia barely blinked.“The markets are wrong” about inflation expectations, said Sicilia, chief investment officer of the A$56 billion ($43 billion) Host-Plus Pty pension fund in Melbourne. “Deflationary forces are bigger. Interest rates are going to stay at effectively zero.”With governments around the globe still adding to trillions of dollars of stimulus to ride out the pandemic, pension fund managers who are trying to discern the long-term effects are posing the question: Will inflation make a comeback? If it does, more than $46 trillion of global pension assets would be affected as central banks pivoted toward sustained higher interest rates.Interviews with five pension funds that help oversee parts of Australia’s A$2.9 trillion ($2.3 trillion) in retirement assets reveal a rank of investors largely unconcerned about the risk of rising prices.Last week, bond trades triggered speculation that inflation may accelerate to multi-year highs as the inevitable conclusion to the world’s $19.5 trillion coronavirus rescue package. Yields on 10-year Treasuries surged to pre-pandemic levels on Thursday, convulsing markets from stocks to credit as traders bet on more aggressive tightening -- with a U.S. interest rate hike briefly priced in for late 2022, at least a year earlier than the Federal Reserve had signaled.Debt markets calmed on Monday, as investors bet central banks would ramp up asset purchases to prevent yields rising too quickly.“I don’t think they would want to risk any recovery” by allowing markets to tighten too quickly, said Michael Clavin head of fixed-income at the A$140 billion Aware Super, Australia’s second-biggest pension fund by assets. There may be a “burst of inflationary data, but we’re not really sure it’s sustainable.”Wind VaneLike Sicilia, Clavin points to technology advancements as the biggest damper on long-term price growth.Economists have struggled for years to quantify technology’s deflationary impact on everything from supply chains to wage growth -- Clavin’s wind vane for price pressures -- but the overall effect has been to stifle price increases. And that’s not including the increased unemployment from the pandemic.Read More: Aggressive Fed Hike Bets Spur Treasury Buy-the-Dip Calls“There’s still quite a big hurdle to get the jobs back that were lost,” Clavin said. “I don’t see how you’re going to overcome those deflationary forces without some sort of wage growth.”Aware is sticking to a strategy that includes being overweight in global equities and cash in its default option to ride out the market volatility. It also invests about 15.6% of its default fund in fixed-income assets.Sicilia continues to shun “outrageously expensive” bonds and is investing in stocks and private equity on bets that risk-assets will continue to outperform as central banks keep rates near record lows.“In five to 10 years’ time, you’ll have people saying ‘we should have bought equities at 20 times earnings,’” he said. “If technology is the root cause of no inflation, that means you’re not going to be able to generate inflation anytime soon.”While bond markets suggest there may be “inflation in the pipeline”, it might be short-lived, said John Pearce, Sydney-based investment chief at the A$90 billion UniSuper Management Pty.The 30-year market veteran points to Japan as an example where inflation remains elusive despite years of quantitative easing and ultra-loose monetary policy. Markets today are a far cry from the 1970s when a massive oil shock and collapse of the Bretton Woods system turbocharged price hikes, he said.“You look at the marginal cost of everything just plummeting because of the improvements in technology -- I don’t see that stopping anytime soon,” said Pearce. “We’re not a believer that we’re going to see persistently high inflation.”It may be “worth having a look at” 10-year Treasuries if yields climb to 2.5%, he said.Contrarion BetsThat’s not to say that the recent volatility hasn’t produced some buying opportunities.When bond yields plunged to historic lows last year, IOOF Holdings Ltd. pivoted some of its funds from government debt to credit and senior loans. By December, one of the Melbourne-based pension’s underlying asset managers had switched from a long duration position -- or holding securities with higher interest-rate risk -- to a short on signs inflation pressures were building.The wagers paid off. During the worst month for Australian bond returns on record, the fund’s fixed-income strategy rose 0.6%.“Because we’re starting from such a low base on inflation, you’re probably likely to see over the next three-to-six months” economic data showing some price rises, said Osvaldo Acosta, head of fixed-interest assets who studies bonds and stock returns to look for an inflection point for inflation. “The greatest risk that we saw for the last 12 months was the amount of stimulus both monetary and also fiscal that was coming through -- it is just tremendous.”Now, with U.S. yields pulling global rates higher, Acosta is weighing his fund’s position. “Bonds are starting to look attractive,” he said.Even so, most of those managing Australia’s giant pension funds don’t see a return to the high levels of inflation that characterized U.S. economics in the 1970s.Con Michalakis, chief investment officer of Statewide Superannuation Pty, compares the S&P 500 Index dividend yield against the U.S. 10-year benchmark as a bond valuation barometer and he’s now looking at opportunities in government debt after the selloff.“We’re going to hit an inflection point -- bonds near 2% offer some insurance value that they didn’t offer when they were 80 basis points,” said Adelaide-based Michalakis. “We are in an era of slightly higher structural long-term inflation, but nothing disastrous.”(Adds tout)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.
Last week, the NASDAQ slipped below 13,200, making the net loss from its all-time peak, reached earlier this month, 6.4%. If this trend keeps up, the index will slip into correction territory, a loss of 10% from its peak. So what exactly is going on? At bottom, it’s mixed signals. The COVID-19 pandemic is starting to fade and the economy is starting to reopen – strong positives that should boost markets. But an economic restart brings with it inflationary pressures: more people working means more consumers with money in their pockets, and the massive stimulus bills passed in recent months – and the bill working through Congress now, which totals $1.9 trillion – have put additional funds in people’s wallets and liquidity into the economy. There is pent-up demand out there, and people with money to spend, and both factors will work to push up prices. We can see one effect of all of this in the bond market, where the ten-year Treasury bond is yielding 1.4%, near a one-year high, and it has been trending upwards in recent weeks. This may be a case of jumping the gun, however, as Federal Reserve Chair Jerome Powell has said in testimony before the Senate that he is not considering a move to boost interest rates. In other words, these are confusing times. For those feeling lost in all of the stock market fog, investing gurus can offer a sense of clarity. No one more so than billionaire Steven Cohen. Cohen’s investment firm, Point72 Asset Management, relies on a strategy that involves investments in the stock market as well as a more macro approach. This very strategy has cemented Cohen’s status as a highly respected investing powerhouse, with the guru earning $1.4 billion in 2020 thanks to a 16% gain in Point72′s main hedge fund. Bearing this in mind, our focus shifted to Point72's most recent 13F filing, which discloses the stocks the fund snapped up in the fourth quarter. Locking in on three tickers in particular, TipRanks’ database revealed that each has earned a “Strong Buy” analyst consensus and boasts significant upside potential. Array Technologies (ARRY) The first new position is in Array Technologies, a ‘green tech’ company providing tracking technology for large-scale solar energy projects. It’s not enough just to deploy enough photovoltaic solar collection panels to power an energy utility; the panels have to track the sun across the sky, and account for seasonal differences in its path. Array delivers solutions to these problems with its DuraTrack and SmarTrack products. Array boasts that its tracking systems will improve the lifetime efficiency of solar array projects, and that its SmarTrack system can boost energy production by 5% overall. The company clearly has impressed its customers, as it has installations in 30 countries, in more than 900 utility-scale projects. President Biden is expected to take executive actions to boost green economic policy at the expense of the fossil fuel industry, and Array could potentially benefit from this political environment. This company’s stock is new to the markets, having held its IPO in October of last year. The event was described as the ‘first big solar IPO’ in the US for 2020, and it was successful. Shares opened at $22, and closed the day at $36. The company sold 7 million shares, raising $154 million, while another 40.5 million shares were put on the market by Oaktree Capital. Oaktree is the investment manager that had held a majority stake in the company since 2016. Among Array's fans is Steven Cohen. Scooping up 531,589 shares in Q4, Point72's new ARRY position is worth over $19.7 million at current valuation. Guggenheim analyst Shahriar Pourreza also seems to be confident about the company's growth prospects, noting that the stock appears undervalued. “Renewable energy companies have seen a large inflow of capital as a result of the ‘blue wave’ and the Democrats’ control of the White House and both chambers of Congress; however, ARRY continues to trade a significant discount to peers," the 5-star analyst noted. Pourreza added, "We continue to be bullish on ARRY’s growth prospects driven by 1) tracker market share gains over fixed-tilt systems, 2) ARRY market share gains within the tracker industry, 3) ARRY’s large opportunity in the less-penetrated international market, 4) the opportunity to monetize their existing customer base over the longer-term through extended warranties, software upgrades, etc., which are highly margin accretive.” In line with these bullish comments, Pourreza rates ARRY shares a Buy, and his $59 price target implies a 59% upside from current levels. (To watch Pourreza’s track record, click here) New stocks in growth industries tend to attract notice from Wall Street’s pros, and Array has 8 reviews on record since it went public. Of these, 6 are Buys and 2 are Holds, making the consensus rating on the stock a Strong Buy. The average price target, at $53.75, suggests room for ~45% upside in the next 12 months. (See ARRY stock analysis on TipRanks) Paya Holdings (PAYA) The second Cohen pick we're looking at is Paya Holdings, a North American payment processing service. The company offers integrated payment solutions for B2B operations in the education, government, healthcare, non-profit, and utility sectors. Paya boasts over $30 billion in payments processed annually, for over 100,000 customers. In mid-October of last year, Paya completed its move to the public market via a SPAC (special acquisition company) merger with FinTech Acquisition Corporation III. Cohen is standing squarely with the bulls on this one. During Q4, Point72 snapped up 3,288,843 shares, bringing the size of the holding to 4,489,443 shares. After this 365% boost, the value of the position is now ~$54 million. Mark Palmer, 5-star analyst with BTIG, is impressed with Paya’s prospects into the mid-term, writing, “We expect PAYA to generate revenue growth in the high-teens during the next few years, with Integrated Solutions poised to grow in the mid-20s and Payment Services set to grow in the mid-single digits. At the same time, the company’s operating expenses should grow in the 5% context, in our view. As such, we believe PAYA’s adjusted EBITDA growth will be north of 20% during the next few years, and that its adjusted EBITDA margins will expand to 28% by YE21 from 25% in 2019.” Palmer puts an $18 price target on PAYA shares, indicating his confidence in 49% growth for the year ahead, and rates the shares as a Buy. (To watch Palmer’s track record, click here) PAYA’s Strong Buy analyst consensus rating is unanimous, based on 4 Buy-side reviews set in recent weeks. The shares have an average price target of $16, which suggests ~33% upside potential from the current share price of $12.06. (See PAYA stock analysis on TipRanks) Dicerna Pharma (DRNA) Last but not least is Dicerna Pharma, a clinical stage biotech company with a focus on the discovery, research and development of treatments based on its RNA interference (RNAi) technology platform. The company has 4 drug candidates in various stages of clinical trials and another 6 in pre-clinical studies. The company's pipeline clearly got Steven Cohen’s attention – to the tune of taking a new stake totaling 2.366 million shares. This holding is worth $63.8 million at current values. The drug candidate farthest along Dicerna’s pipeline is nedosiran (DCR-PHXC), which is being investigated as a treatment for PH, or primary hyperoxaluria – a group of several genetic disorders that cause life-threatening kidney disorders through overproduction of oxalate. Nedosiran inhibits the enzyme that causes this overproduction, and is in a Phase 3 trial. Top-line results are expected in mid-’21 and, if everything goes as planned, an NDA filing for nedosiran is anticipate near the end of 3Q21. Covering the stock for Leerink, analyst Mani Foroohar sees nedosiran as the key to the company’s near-term future. “We expect nedosiran could see approval in mid-2022, placing the drug roughly a year and a half behind competitor Oxlumo (ALNY, MP) in PH1... A successful outcome will transform DRNA into a commercial rare disease company in an attractive duopoly market with best-in-class breadth of label," Foroohar noted. To this end, Foroohar rates DRNA an Outperform (i.e. Buy), and his price target of $45 suggests a one-year upside potential of 66%. (To watch Foroohar’s track record, click here) All in all, Dicerna Pharma has 4 Buy reviews on record, making the Strong Buy unanimous. DRNA shares are trading for $26.98, and their $38 average price target puts the upside at ~41% over the next 12 months. (See DRNA stock analysis on TipRanks) To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. 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.
Buffett views his stock portfolio as a 'collection of businesses.'
skyTran's technology can be used in a pod taxi, which is like a driver-less cable car that runs on electricity.
Space-transportation startup Rocket Lab USA Inc. is nearing a deal to go public through a merger with special purpose acquisition company Vector Acquisition Corp. (NASDAQ: VACQ), the Wall Street Journal reported Sunday, citing people familiar with the matter. What Happened: According to the WSJ report, the deal could value the small-satellite launch firm at about $4.1 billion, including debt, and could be finalized by Monday. The deal comes amid a wave of SPAC mergers on Wall Street in recent months. San Francisco, California-based Vector Acquisition raised $300 million through an initial public offering in September last year. The SPAC is backed by technology-focused private equity firm Vector Capital. Rocket Lab, like British billionaire Richard Branson’s Virgin Orbit LLC, is focused on launching smaller satellites into space, while Tesla Inc. (TSLA) CEO Elon Musk’s SpaceX sends heavier satellites into higher orbits. SpaceX raised 0 million in a funding round in early February that valued the company at $74 billion. Branson’s other entity, Virgin Galactic Holdings, Inc. (NYSE: SPCE), went public through a SPAC merger in 2019. Last week, the space tourism company reported a net loss for the fourth quarter that narrowed from the prior year despite nil revenue. See Also: 3 Former SPACs Report Earnings: What Fisker, Velodyne Lidar, Virgin Galactic Investors Should Know Why It Matters: Rocket Lab has already launched 97 satellites for the government and for private companies, according to the company’s website. The startup’s backers include defense giant Lockheed Martin Corp. (NYSE: LMT). Rocket Lab could reportedly use the proceeds from the deal to fund the development of a medium-lift Neutron launch vehicle to be used for satellite mega-constellations, space missions, and commercial spaceflight. The rocket could be positioned as a lower-cost alternative to larger vehicles. The company is also developing the Photon Spacecraft for the NASA moon mission. Price Movement: Vector Acquisition closed almost 0.7% lower on Friday at $10.25. Photo courtesy: Rocket Lab USA Inc. See more from BenzingaClick here for options trades from BenzingaFisker's Goals Go Well Beyond Simply Chipping Away Tesla's Market Share: CEOWhy Tesla Took Off Standard Range Model Y From Its Offerings© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The U.S. House has given its OK; here's what's ahead.
(Bloomberg) -- As investors fled almost every fixed-income asset from the safest government bonds to the highest-yielding securities last week, one market stood out as a haven.Funds poured $671 million into exchange-traded funds tracking yuan bonds last week, taking inflows so far this year to $2.2 billion, data compiled by Bloomberg show. In contrast, they offloaded almost $600 million of emerging-market notes last week.China’s bonds have largely escaped the tumult in global debt markets, with yields on the benchmark holding firm on Thursday while that on Treasuries soared more than 20 basis points. Chinese sovereign notes were the third-best performer globally in February, according to data from indexes compiled by Bloomberg and Barclays Plc.“China bonds are likely to be a safe haven now -- stable policy and growth make them less volatile compared to global peers, while yields are also more attractive,” said Xing Zhaopeng, a senior China strategist at Australia & New Zealand Banking Group Ltd. in Shanghai. “The notes’ relative performance this year will be better than bonds sold by other major economies.”With strategists warning of more volatility in the days ahead, investors may find safety in the more-insulated Chinese debt market where fears of sudden monetary tightening are less prevalent. The authorities’ successful containment of the coronavirus outbreak has also allowed the economy to rebound more quickly.China’s benchmark 10-year yield fell two basis points to 3.26% Monday while 10-year bond futures jumped 0.3%, the most since December. The spread between the 10-year Chinese yield and its U.S. counterpart was at 1.82 percentage points on Monday. This compares with a five-year average of 1.25 percentage points.EPFR Global data showed China bond funds absorbed record flows in the week ended Feb. 24, with investments almost breaching the $2 billion mark.Other large Asian economies such as Indonesia and India do offer higher returns, but they remain vulnerable at times of stress, with major ratings agencies assessing China’s debt as four-to-five levels more sound.And while other countries are still in the process of selling near-record amount of debt to fund stimulus, China’s faster-economic recovery means there could be less supply. Economists expect the government to lower its fiscal deficit target, while cutting its quota for special local bonds.The iShares China CNY Bond UCITS ETF, which tracks the Bloomberg Barclays Index of Chinese government and policy bank debt, saw the largest inflows among all similar contracts this year, data compiled by Bloomberg showed. The fund gained 8.8% over the past year, beating most global peers.The Bloomberg Barclays China Aggregate Index, which tracks the performance of the yuan-denominated debt, is up 1.5% year-to-date, while the global aggregate index is down 2.6%.Overseas investors are also buying more Chinese notes directly. In January, they purchased $27 billion of bonds in the interbank market, the most according to data going back to 2014. Sovereign securities accounted for $19 billion of the total inflows.(Adds China bond yield and futures in sixth paragraph, EPFR Global data in seventh paragraph and background in eighth and ninth paragraphs)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.
(Bloomberg) -- After last week’s fire-sale in bonds, some traders say expectations for interest-rate hikes have become too aggressive and it’s time to buy.While swaps traders see the Federal Reserve raising rates in March 2023, some strategists say that’s too much and recommend buying short-maturity bonds to fade the move. Five-year Treasuries outperformed on Monday, while their 30-year counterparts extended declines, with yields climbing further above 2.20%. In the U.K., where money markets have completely priced out rate cuts, UBS Group AG sees rates eventually meeting “fundamental resistance.”The rapid reflation-fueled selloff that besieged bond markets last week is showing signs of stalling as investors take advantage of better valuations and with central banks lining up to emphasize that they’re in no rush to start tightening monetary policy. Traders are due to get a sense of whether poicy makers backed up their words with actions last week, with data on European Central Bank bond-buying due later.“Central banks as well as markets need to realize that even homeopathic tightening doses can trigger outsized market reactions,” said Christoph Rieger, head of fixed-rate strategy at Commerzbank AG. It “will be interesting to get some indications whether markets are firmly in buy-the-dip mode or whether it is the ECB.”Short is SweetOver in Treasuries, shorter maturities are proving popular after last week’s rout. JPMorgan Chase & Co.’s Jay Barry recommended purchasing five-year notes in the U.S., while strategists at TD Securities doubled down on their bullish stance on the same securities on Friday.Barclays Plc’s Anshul Pradhan told investors to buy three-year securities, while Citigroup Inc.’s Jabaz Mathai recommended the “belly of the curve,” which traditionally means maturities between three and seven years.Their views seem to have struck a chord with investors. Five-year yields fell as much as five basis points to 0.68%, and 30-year equivalents climbing six basis points to 2.20%.Five-year Treasuries slumped last week as traders brought forward the pricing of rate hikes, driving an exodus of positions which had previously been sheltered by rate guidance from the Federal Reserve. Yields on the securities surged 16 basis points to 0.73% in the five days through Friday, with Thursday’s move the worst performance on the yield curve since 2002.Read more: Dizzied Bond Traders Brace for More Pain as Fed Speakers Line Up‘Not Sustainable’“We think these moves are not consistent with the Fed’s stance and framework, and therefore not sustainable,” Guneet Dhingra, head of U.S. interest-rate strategy at Morgan Stanley in New York, wrote about the rate-hike expectations. The Fed is likely to push back against the market pricing in rate hikes in 2023, he said.In remarks last week, Fed Chair Jerome Powell offered a reassurance that policy would continue to be supportive and look beyond a temporary pick-up in inflation, especially from a low base. The central bank’s so-called dot plot -- which it uses to signal its outlook for the path of interest rates -- shows a majority of Fed members expect rates to be unchanged from current levels at the end of 2023.Powell will deliver this week what are likely his final public comments before a mid-month policy meeting.Periphery PositionsAcross the Atlantic, investors are also buying back into the trades that were hardest hit during last week’s selloff. Banco Santander SA is positioning for peripheral spreads over Germany -- like Italy and Spain -- to narrow. UBS meanwhile, sees U.K. rate valuations as getting close to levels to re-enter. Last month, 10-year gilt yields rose the most since 2016.“While we’re not quite recommending buying the dip,” said John Wraith, head of U.K. and European rates strategy at UBS, “we are definitely getting close to attractive levels to position for a reversal.”(Updates with European moves and recommendations throughout.)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.
A federal judge has approved a $650 million settlement of a class-action privacy lawsuit against Facebook that claimed the company used its facial recognition feature without user consent. What Happened: In 2015, Chicago attorney Jay Edelson filed a lawsuit against Facebook, Inc (NASDAQ: FB) in Cook County Circuit Court. According to the lawsuit, Facebook violated Illinois' Biometric Information Privacy Act, by failing to get consent before using facial-recognition technology, which scans photos uploaded by users to create and store faces digitally, The Verge has reported. Along with the settlement amount, the judge also ordered the 1.6 million members of the class-action lawsuit in Illinois to be paid “as expeditiously as possible.” See also: How To Buy Facebook Stock Why It Matters: According to the order by Judge James Donato of the Northern District of California, the three named plaintiffs will each receive $5,000 and others in the class-action lawsuit will get at least $345 each, the report said. Donato described the settlement as a “landmark result” and said it "is one the largest settlements ever for a privacy violation." In a statement, Facebook said, “We are pleased to have reached a settlement so we can move past this matter, which is in the best interest of our community and our shareholders.” Facebook isn't the only company to run into the Illinois law. Sony Corp (NYSE: SNE) doesn't sell its robot dog, aibo, which has facial recognition technology, in the state because of the law. See more from BenzingaClick here for options trades from BenzingaThousands Of Bots May Have Played Role In GameStop Hype: ReportSEC Suspends Trading In 15 Stocks Over Social Media Concerns© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
There are many critics of corporate stock buybacks, but Warren Buffett is certainly not one of them.
(Bloomberg) -- GameStop. Nokia. The Bank of Japan?Japan’s central bank joined the ranks of equities with puzzling surges in valuation led by retail investors on Monday, as its shares surged by their daily limit. The stock rose 18%, the most since 2005, to 33,000 yen a share.Even experienced investors are often surprised to learn that as well as being Japan’s lender of last resort and a key pillar supporting the equity market, the BOJ is itself a publicly listed entity on the Tokyo Stock Exchange’s Jasdaq section.As an asset, the stock is hardly attractive -- carrying no voting rights and offering extremely limited dividends. But in an era when sneakers are an asset class and a joke cryptocurrency is worth $6 billion, the chance to buy a bank that literally prints money may be too good a proposition for retail investors to pass up.“One shouldn’t treat BOJ shares as a normal stock -- that’s nonsense,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities Co. “But since the BOJ’s share price is driven by retail investors, it can show what the sentiment is like among that group.”Despite the minuscule trading volume with only 4,100 shares exchanged, Monday’s spike was enough to catch the attention of day traders on Twitter and other online forums where Japan’s growing horde of retail investors share their insights. Many were bewildered by the move. Others seemed surprised to learn that the country’s central bank was in fact a listed stock.From 2015: The Double Mystery of BOJ Stock Rally Boosting Japan’s MegabanksThe BOJ is one of the world’s few publicly traded central banks, with peers including Belgium, Greece and Switzerland. The government holds most of its shares with a 55% stake, while individual investors have 40%.There’s no real benefit to owning a share, or subscriber certificates as they’re technically called. For some, it’s merely a status symbol. In the bubble era of the 1980s, some individual investors used to frame their certificates of ownership as a sort of collectible, Fujito explained. At its peak in October 1989, a single BOJ share cost an eye-watering 745,000 yen, more than twenty times its current valuation.“Short-term retail investors don’t care about dividends, they’re looking just for capital gains,” said Tomoichiro Kubota, a senior market analyst at Matsui Securities Co. “They’ll see it as attractive so long as the share price keeps rising and there are buyers.”With Japan’s stocks recently climbing to 30-year highs, retail investor sentiment is improving, Fujito said. Individual investors accounted for 27% of the trading value in the Tokyo and Nagoya Stock Exchanges as of Feb. 19, according to data compiled by Bloomberg.(Updates with final share price, additional comment from analyst in ninth paragraph.)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.