𝘼 𝙨𝙡𝙞𝙜𝙝𝙩𝙡𝙮 𝙘𝙤𝙧𝙧𝙚𝙘𝙩𝙞𝙫𝙚 𝙬𝙚𝙚𝙠 𝙗𝙚𝙝𝙞𝙣𝙙 𝙪𝙨. 𝙏𝙝𝙚 𝙘𝙤𝙧𝙧𝙚𝙘𝙩𝙞𝙤𝙣 𝙬𝙖𝙨 𝙖𝙘𝙘𝙤𝙢𝙥𝙖𝙣𝙞𝙚𝙙 𝙬𝙞𝙩𝙝 𝙖 𝙡𝙞𝙩𝙩𝙡𝙚 𝙩𝙞𝙡𝙩 𝙩𝙤𝙬𝙖𝙧𝙙𝙨 𝙂𝙧𝙤𝙬𝙩𝙝 𝙛𝙧𝙤𝙢 𝙩𝙝𝙚 𝙧𝙚𝙘𝙚𝙣𝙩𝙡𝙮 𝙞𝙣-𝙫𝙤𝙜𝙪𝙚 𝙑𝙖𝙡𝙪𝙚 𝙨𝙩𝙤𝙘𝙠𝙨. 𝙁𝙞𝙨𝙘𝙖𝙡 𝙩𝙖𝙡𝙠𝙨 𝙨𝙚𝙚𝙢 𝙩𝙤 𝙗𝙚 𝙣𝙚𝙫𝙚𝙧 𝙚𝙣𝙙𝙞𝙣𝙜 𝙣𝙤𝙬 𝙖𝙣𝙙 𝙞𝙣𝙫𝙚𝙨𝙩𝙤𝙧𝙨 𝙨𝙩𝙞𝙡𝙡 𝙜𝙚𝙩 𝙣𝙤 𝙙𝙚𝙖𝙡 𝙤𝙣 𝙖 𝙣𝙚𝙬 𝙨𝙩𝙞𝙢𝙪𝙡𝙪𝙨. 𝘾𝙤𝙫𝙞𝙙-𝟭𝟵 𝙘𝙖𝙨𝙚𝙨 𝙖𝙧𝙚 𝙨𝙩𝙞𝙡𝙡 𝙤𝙣 𝙩𝙝𝙚 𝙧𝙞𝙨𝙚 𝙞𝙣 𝙜𝙚𝙣𝙚𝙧𝙖𝙡 𝙥𝙪𝙩𝙩𝙞𝙣𝙜 𝙥𝙧𝙚𝙨𝙨𝙪𝙧𝙚 𝙤𝙣 𝙨𝙝𝙤𝙧𝙩-𝙩𝙚𝙧𝙢 𝙤𝙥𝙩𝙞𝙢𝙞𝙨𝙢.
Equity indices took a breather this week after having eked out new all-time highs (ATH) in the previous week and intra-week ATH this Wednesday. $SPX500 slid 1% on week and so did other American as well as EU and JP stocks. The commodities front calmed down. Here’s what was up…
👉 On Monday a clear outperformance of Growth vs. Value was seen. Whilst $DJ30 dropped, Nasdaq was still up. Similar tendency was seen in the mid-cap space represented by iShares Russell 1000 Value ETF ($IWD) and the iShares Russell 1000 Growth ETF ($IWF).
👉 At the start of the week BlackRock made a bullish call for equities for 2021 seeing a “powerful restart of the economy”: www.cnbc.com/2020/12/07/blackrock-takes-equities-to-overweight-for-2021-sees-powerful-restart-to-the-economy.html?__source=newsletter%7Ceveningbrief
👉 On Tuesday UK started their vaccinations for Covid-19. Shares of $PFE (Pfizer) jumped 3%. The US approval of their vaccine is still due.
👉 On Wednesday 𝙐𝙆 𝙗𝙚𝙘𝙖𝙢𝙚 𝙩𝙝𝙚 𝟭𝙨𝙩 𝙘𝙤𝙪𝙣𝙩𝙧𝙮 𝙩𝙤 𝙖𝙥𝙥𝙧𝙤𝙫𝙚 𝙩𝙝𝙚 $𝙋𝙁𝙀 -𝘽𝙞𝙤𝙉𝙏𝙚𝙘𝙝 𝙫𝙖𝙘𝙘𝙞𝙣𝙚, pouring further optimism into the market. Indices closed at yet new highs on that day. Energy names poped higher as well ending up 1.5% on the day. Revival play stocks like $DD (DowDuPont Inc) , $JNJ (Johnson & Johnson) and $MMM (3M) also led the gains.
👉 Wednesday turned out corrective for the high-tech space mainly. Semiconductors, $AAPL (Apple) , $CRM (Salesforce.com Inc) , $FB (Facebook) were all down on day. Nasdaq slid almost 2%. The drop had no characteristics of deeped sell-offs. Volatility generally remained low as measured by the VIX.
👉 𝙒𝙚𝙚𝙠𝙡𝙮 𝙟𝙤𝙗𝙡𝙚𝙨𝙨 𝙘𝙡𝙖𝙞𝙢𝙨 𝙘𝙖𝙢𝙚 𝙤𝙪𝙩 𝙖𝙗𝙤𝙫𝙚 𝙚𝙭𝙥𝙚𝙘𝙩𝙖𝙩𝙞𝙤𝙣𝙨 𝙤𝙣 𝙏𝙝𝙪𝙧𝙨𝙙𝙖𝙮. The number for preceeding week hit 853k vs. 730k expected. Weaker labour market data spurred renewed pressure on Washington to reach a consensus on new stimulus as soon as possible. The need for additional support was sounded out from different sources again.
👉 On Friday $DIS (Walt Disney) 𝙛𝙡𝙚𝙬 𝙝𝙞𝙜𝙝𝙚𝙧 𝙖𝙨 𝙞𝙩 𝙧𝙚𝙫𝙚𝙖𝙡𝙚𝙙 𝙗𝙪𝙡𝙡𝙞𝙨𝙝 𝙨𝙩𝙧𝙚𝙖𝙢𝙞𝙣𝙜 𝙥𝙧𝙤𝙟𝙚𝙘𝙩𝙞𝙤𝙣𝙨. ended up 13%. The media copmany expects to have 230-260m subscribers by 2024. The broad market still struggled though and indices ended lower for the third consecutive day.
👉 𝙀𝙛𝙛𝙚𝙘𝙩𝙞𝙫𝙚 𝙬𝙚𝙚𝙠𝙡𝙮 𝙞𝙣𝙙𝙚𝙭 𝙘𝙝𝙖𝙣𝙜𝙚𝙨: $SPX500 -1%, $NSDQ100 -1.2%, EuroStoxx600 -1%, $GER30 -1.4%, $JPN225 -0.4%.
𝗢𝘁𝗵𝗲𝗿 𝗺𝗮𝗿𝗸𝗲𝘁𝘀 𝗲𝘃𝗲𝗻𝘁𝘀:
👉 𝘽𝙤𝙣𝙙𝙨: the US yield curve (10y-FF) took a breather this week ending 85bps, the German curve (10Y Bunds-3M) currently at 11bps with 10Y Bunds at -0.63%, as their prices took a jump vs. last week. EuroArea AAA-rated bonds yield curve stands at 16bps. High Yield Spreads keep falling towards 4.
👉 𝘾𝙤𝙢𝙢𝙤𝙙𝙞𝙩𝙞𝙚𝙨 (𝙚𝙭 𝙤𝙞𝙡): Gold ($GLD) flat on week, Silver ($SLV) -1% on week. Not much action here.
👉 𝙊𝙞𝙡: added 1.3% and WTI hovers around $45-46
👉 𝘾𝙪𝙧𝙧𝙚𝙣𝙘𝙞𝙚𝙨: DXY (Dollar Index) up 0.3% on week, $EURUSD flat.
Major macro events: (times are CET; source: tradingeconomics.com):
Next Week’s major macro events:
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