While the cool down of volatility on the part of flash mob retail traders from Reddit's WallStreetBets during this week raised the confidence of many market participants that the situation could become more stable, there was a lack of fresh and clear drivers.
One of the drivers could be the particular statistical fact cited by Bloomberg that the number of Americans who received at least one dose of the vaccine is now more than 26.5 million, which exceeded the 26.3 million who have been diagnosed with the disease so far.
The oil market seems to be awakening to a cloudy beginning of February and, as a result, it cannot see its shadow. Just like a groundhog, who knows that such a circumstance signals an early spring, the oil market may also assume a turnaround is on its way. Such an analogy may seem fitting as Brent crude benchmark prices topped $57.7 per barrel on February 2, which was exactly the same level that was recorded on the same day last year. A true celebration of another Groundhog Day with hopes of an early economic recovery.
A handful of turbulent welters shuffled the deck of cards in a rather freakish style in both the United States and European markets over the past two days and nights. The populist flash mob of private, small traders' has originated or organised over online forums, such as Reddit, to force short-selling hedge funds to reverse their big short positions on a series of roadside stocks.
The single European currency seems to attract most of the investors’ attention as its share grows in both international settlements and forex reserves. The pair manifests Hegel’s philosophy of law: unity and struggle of opposites. Both components of the currency pair represent two major world economies with risk aversion that sometimes can mimic the relationship of friends and antagonists at the same time.
Market sentiment recently suggested that the Euro could rise significantly in 2021, and there is a strong background behind this expectation.
While the reaction of some assets to the corresponding corporate earnings reports is very positive and eloquent, the major S&P500 broad market index looks frozen in the vicinity of a 3850 point milestone. Thus, funds are likely to be redistributed between different segments of the stock market: for example, from the previously overvalued banking sector with worse-than-expected financial performance to some high-tech leaders which are collecting most of the gains.
On Tuesday evening, Microsoft stock price rose by another 5.
It seems that the demand for Gold assets is gradually starting to grow again. It was topped in the first days of January when the price almost reached $1960 per troy ounce (toz), but then quickly dropped after January 6 on the prospect of orderly and smooth official transition of power in Washington. When the very peak of political tension in the United States had been passed, the spot price of Gold even declined temporarily to the $1800/toz area. However, it rather seemed to be a short set piece of the whole Gold performance or just an episode.
Apple shares (APPL) rose 7.07% over the last two trading sessions to reach a market capitalisation of $2.3 trillion. The current price of $136.87 per share is attributed primarily to the clearly positive sentiment ahead of the highly expected earnings report, which is going to be released on January 27. But the market price is already moving forward, aiming for a retest of the company's all-time high of $138.79 with even better targets in sight if positive scenarios come to light.
The British Pound seems to be performing an unexpected rally amid moderately strengthening of the U.S. Dollar. The Cable rose to new January highs at 1.3710 on Wednesday. Such levels have not been seen since April 2018.
The reason for the rally is most likely a higher than expected inflation of 1.4% YoY in the United Kingdom. The CPI index in December was also higher than expected at 0.6% vs 0.3% last November. The inflation rose after the UK government lifted some traveling restrictions amid overall national quarantine.
A rather unwieldy market of the current week, at which even mostly overbought assets of the fast-recovering banking sector just rolled back submissively to some lower levels despite their positive Q4 financial reports, were pleasantly surprised by high-flying Netflix shares again. The largest streaming service in the world set another record on its global paid membership of more than 203 million subscribers.
The last-quarter figure bounced back to top 8.51 million new customers over this period which included holidays and lockdowns, so people spent a lot of extra time at their homes.
As the first season of corporate reports has started for the year, major Wall Street banks provided mixed Q4 earnings results. JP Morgan Chase (JPM), which is ranked by S&P Global as the seventh largest banking organisation globally and also as the largest bank in the U.S. with total assets of more than $3 trillion, reported its profit results of $3.08 per share after $2.57 a year ago in Q4, 2019. The figures topped the average analysts’ consensus estimate of $2.65 per share shown by Reuters and Bloomberg expert polls. The JPM quarterly revenues amounted to $29.224 bln (+3.