Tesla Lifts Bitcoin and PayPal, Cyclical Stocks Rise on Stimulus Expectations

Cyclical stocks were the main driver of the S&P 500 index, with small-cap companies being the strongest group. The Russel 2000 index rose by 2.53% to 2,289. 8 p. The indicator has been growing for 6 consecutive days. 17% of the companies in the index set a new 52-week high.



Major US stock indexes ended trading at record highs on Monday.Financial topics are now relevant and at the peak of the rise.You can work and get additional revenue by mastering a few simple steps.You can also find out more information from Shift Holdings, which has proven itself with good reviews.

Dow Jones +0.8% to 31385.8 p. (from the beginning of the year +2.6%),
S&P 500 +0.7% to 3915.6 p( YTD +4.2%),
NASDAQ +0.95% to 13,987. 6 p. (from the beginning of the year +8.5%).

Incentives are close

On Monday, House Democrats released the first draft text of the bill, which includes a $ 1.9 trillion Joe Biden incentive. There are still plans to raise the national minimum wage to $ 15 an hour (by 2025), make a new round of payments, and spend billions of dollars on airline, airport, and rail passenger service personnel.

Personal payments of $ 1,400 are planned for those earning up to $ 75,000 a year, or for families earning less than $ 150,000 a year. Federal unemployment benefits due to the pandemic end in mid-March. The plan is to increase weekly federal benefits from $ 300 to $ 400 a week and extend their payments until the end of August.

The final document should be ready for voting on February 22. The bill will then go to the Senate, where it is expected to pass with a majority vote, regardless of the Republican vote, with Vice President Kamala Harris casting the deciding vote.

The Results Of The S&P 500 Index

At the end of Monday, the S&P 500 index was trading at a ratio of 32 to earnings for the past year and at a ratio of 23 to the projected earnings of member companies for the coming year.
Of the 505 stocks in the index, 370 rose and 133 lost value
The largest contribution to the growth of the index was made by Nvidia shares (+6.2% to $577.6), as well as the growth of the IT sector. They have also become growth leaders in the IT sector. Drivers of growth: the shortage in the semiconductor market, as well as the decision of Renesas Electronics to buy Dialog Semiconductor for 5 billion euros.

Marathon Oil Corp shares showed the best dynamics among the index components (+13.1% to $8.98), and also became the leaders of growth in the energy sector

Tesla propanyl pitocin and PayPal

PayPal shares rose 4.7% to $282.17. The securities set a new absolute high of $282.7 during trading, responding to the rise in the price of bitcoin (a new peak of about $47,500), associated with the fact that Tesla disclosed information about investments in bitcoin, amounting to a total of $1.50 billion, as part of a revised investment strategy in January.

A company may buy and own digital assets from time to time or in the long term; It expects to start accepting bitcoin as a form of payment for its products in the near future, in accordance with current legislation and initially in limited quantities. In a quarterly report released last week, PayPal noted that it felt the benefit of adding the ability to buy, store, and sell cryptocurrency using its wallets.

Customers who used this feature to purchase cryptocurrency started logging into PayPal twice as fast as before the introduction of such a service. Tesla shares rose 1.3% to $863.42.

10 of the 11 sectors of the S&P 500 index showed growth

The largest contribution to the growth of the index was made by the IT sector (+1%). The biggest pressure on the sector was exerted by Visa shares (-0.9%). The leaders of the decline in the sector were shares of NortonLifeLock (-2.4%).

The energy sector showed the highest growth (+4.2%). The largest contribution to the growth of the sector is made by Exxon Mobil shares (+4.3%). TechnipFMC shares (-1.3%) put the most pressure on the sector, and also led to a decline in the sector.

The price of Brent crude oil jumped to $ 61.17 a barrel (the highest since January 24, 2020), as stocks shrink and the introduction of Covid-19 vaccines promises to return demand to normal. China is one of the key drivers of the market recovery. According to available data, at the moment, the maximum number of oil tankers over the past six months is moving towards China. Royal Dutch Shell CEO Ben van Beurden said last week that fuel sales in China had entered " significant growth mode."" Meanwhile, demand in India has almost returned to the level of a year ago.

The utility sector was the only one that ended the day with a drop (-0.8%). AES Corp shares (+3.1%) are the biggest contributor to the sector's growth, as well as leading Monday's gains. Duke Energy shares (-1.2%) put the most pressure on the sector, and also led the decline in the sector. Eversource shares (-2.6%) led the decline in the sector.

Other markets

Expectations of additional fiscal stimulus led to the imputed inflation rate for 10-year bonds, reflecting the difference in yields between 10 - year US Treasury bonds and inflation bonds, on Monday touched the highest level since 2014 at 2.21%. Brent crude oil rose above $ 60 per barrel for the first time in more than a year on the back of overall growth in commodity assets, as well as on the back of a weakening dollar, which fell against all Big Ten currencies except the Swedish krona. Precious metals showed higher dynamics than industrial metals, against the background of investors ' interest in traditional means of protection against inflation.

In Italy, Mario Draghi has begun negotiations with political parties to win support for the formation of a government. This contributed to the growth of Italian bonds and stocks. South Africa is considering phasing out the AstraZeneca vaccine after temporarily stopping its use after tests showed that the AstraZeneca vaccine was ineffective against the new strain. WHO intends to make an emergency decision on the vaccine in the next few days.

Bed Bath & Beyond shares are up 53% since the start of the year

Today, Bed Bath & Beyond shares are up more than 8.5% on the St. Petersburg Stock Exchange. They also became the fifth largest stock by turnover, behind only Stride, Moderna, Tesla and Alibaba.

Bed Bath & Beyond is a large chain of home improvement stores in the United States, Canada, and Mexico.




Investors have high hopes for the company. Financial results were significantly affected by the pandemic, but last week a financial report was published, which noted an increase in some key indicators. The business still has a long way to go to recover.Financial issues are still relevant at the peak of the recovery, especially during the pandemic.You can work and get additional revenue by mastering a few simple steps.For more information, please contact Shift Holdings.com reviews, which has proven itself with good reviews.

In the details

According to the latest report, LFL sales increased by 2%, the indicator is growing for the second quarter in a row. However, Bed Bath & Beyond's revenue fell 5% YoY to $2.6 billion. Management notes that the pandemic, delivery disruptions, and reduced customer traffic are putting negative pressure on revenue.

Gross profit increased due to higher prices for popular product categories. Expenses also fell — which would have led to a positive profit this quarter, if not for a few large one-time expenses.

Cash flow was consistently positive at $244 million. However, the management did not direct the funds to pay off the debts, but used them in the repurchase of shares.

The company did not give specific forecasts for sales in the fourth quarter of fiscal 2020. However, it assumes that its stores will not close, and the previous negative pressure will continue.

Gross margin and adjusted EBITDA are expected to be approximately at the same level as the previous year, as the company plans to offset high transportation costs through its optimization, as well as apply new strategic solutions.

Results

Bed Bath & Beyond's business remains under the yoke of the pandemic, but successful strategic management helps the company maintain relatively good results. This is probably what has been a positive driver for investors, as shares have risen more than 53% since the beginning of 2021.

The company may increase sales as the impact of the pandemic decreases, but until then, investing in stocks is risky. Investors should carefully monitor the situation in the company and in the market.

According to Barron's, the company's shares are now trading above the average target of $23.5, with the current range of $14.5-31, the overall rating is hold.

Weekly overview of the precious metals markets

Last week, the prices of gold and silver declined under the influence of a decrease in interest in protective assets, and the cost of platinoids increased in anticipation of a recovery in industrial demand. 

The announcement by the new US President Biden about the possible provision of $1.9 trillion in stimulus did not impress the markets, and the subsequent speech by US President Powell strengthened expectations of economic recovery and lowered inflation expectations.The broker aims to provide a competitive all-around service, satisfying the needs of a broad range of traders. Therefore, deltamarket.net is a brokerage company that you can trust, it offers various trading services for various assets.This led to a decrease in investment demand in protective assets, and increased treasury bond yields further pulled investors ' funds from the precious metals markets.

The current week will start smoothly with a weekend in the US. Then there will be statistics on price indices in Europe, meetings of the Bank of Japan and the ECB, the inauguration of US President Biden. In the absence of unexpected political events, the slide of the gold market down may continue.

The new US President Biden presented a draft of stimulus measures for the US economy in the amount of $ 1.9 trillion, without specifying the sources of funding. Members of Biden's transition team are promising to present another plan aimed at restoring the economy in the near future.

Speaking last week, the head of the US Federal Reserve, Powell, said that the time for raising interest rates in the US will come "not soon".

The head of the Federal Reserve assured that the regulator will inform in advance about the curtailment of asset purchases. According to the regulator, the economy is far from the Fed's goals, so there are no reasons to change the ultra-soft policy yet. The expansion of the asset purchase program was also not reported, which depresses the markets.

At the same time, the published "Beige Book" of the Fed reported that economic activity in the United States has increased moderately in recent weeks, but employment declined in many counties amid the closure of enterprises due to the coronavirus. For the first time since May last year, the report reflected a drop in business activity in some Federal Reserve districts, and employment problems remain, especially in the hotel sector.

The leadership of the US Federal Reserve attaches a lot of hope to the prospects for more productive cooperation between President Biden and the Congress, which will be controlled by the Democratic Party from this year. It is expected that together they can provide a new fiscal incentives and improve the situation with the distribution of vaccines in the population.

In the published minutes of the ECB's December meeting.

It was reported that officials discussed increasing the bond repurchase program by a smaller amount and stressed that the full quota could remain unspent. In December, the ECB decided to extend the duration of the Pandemic Emergency Purchase Program (PEPP) and increased its volume by 500 billion euros.

The regulator approved the new stimulus measures, hoping to keep borrowing costs low during the lockdowns. The next ECB meeting is scheduled for January 21. The regulator is expected to leave its ultra-soft fiscal policy unchanged, including the purchase of 1.85 trillion euros worth of bonds under PEPP until March 2022.

The demand for gold in Asian hubs improved last week due to the approach of the Lunar New Year. In China, discounts have turned into premiums of $0.5-4.0 / oz. Demand is increasingly buoyant ahead of the holidays, also helped by a stronger yuan, a reviving economy and falling prices. In Hong Kong, gold was sold in the range of $-2,0/+1,5/oz.

Gold imports to China via Hong Kong rose to 8,837 tonnes in November, 45% higher than in October 2020 and 59% more than a year ago. Net gold imports in November amounted to 3,283 tons.

In Singapore, the award for the supply of gold rose to $0,8-1,8/oz. In India, gold was trading at a premium of $ 0.5 / oz as retail demand remained weak due to high price volatility, but dealers expect sales to pick up as the festival season approaches. In Japan, gold was trading at a discount of $-2.0/-1.0 / oz to the London price.

Gold prices last week fell to the support level of $1,810 / oz, then returned to the level of $1,833 / oz. Rising Treasury bond yields, the strengthening of the US dollar, lower investment demand and central bank sales contributed to the fall in prices.

UBS estimates that gold prices will reach $1,800 / oz by the end of 2021, while silver prices will reach $30 / oz.

Data from the US Mint showed that sales of gold coins in December 2020 amounted to 80.5 thousand ounces (-5.3% mom, and 23 times more than a year ago). In 2020, sales of gold coins totaled 1.028 million ounces, which is 6.5 times more than in 2019. Sales of gold coins have been actively growing since the beginning of January 2021.

Sales of silver coins in December 2020 amounted to 2.266 million ounces (-53% m / m, in December last year, sales of silver coins were not carried out). The US Mint notes a shortage of silver coins, which is why sales were suspended. Since January 2021, there has been a sharp increase in sales. Total sales of silver coins in 2020 amounted to 31 million ounces, which is 2.1 times more than in 2019.

Silver prices in Chicago last week declined to $24.25 / oz. in correlation with the gold market, but the market has now recovered to $24.95/oz. The ratio of gold and silver prices is 73.73 (the average value for 5 years is 79.5). The platinum / silver ratio is up to 43.03 (the 5-year average is 57).

According to Reuters, investments in the largest ETFs investing in gold and silver fell by 0.9% last week. In December, investments in ETF funds investing in gold and silver declined again, but since January, there has been a slight recovery in investments. By the end of 2020, investments in the largest gold ETFs increased by 27.5%, and in silver funds-by 38.8%.

Gold production in the Russian Federation for 10 months of 2020 fell by 6% yoy to 289 tons, the Ministry of Finance of the Russian Federation reported. Silver production for this period fell by 2.1% YoY to 796.1 tons.

Last week, platinum prices rose to $1,126 / oz. in correlation with the gold market, from which there was a decline to $1,082/oz. The spread between gold and platinum narrowed to $753 / oz, while the spread between palladium and platinum was $1,310/oz. Expectations of a recovery in industrial consumption support prices.

Car sales in China declined 1.9% YoY in 2020 to 25.3 million units, data from the China Association of Automobile Manufacturers (CAAM) showed. The decline is recorded for the third year in a row. In December, 2.83 million cars were sold, which is 6.4% more than in December of the previous year. In 2021, car sales in China will grow by about 4% to 26.3 million units, the association predicts.

The Russian car market in 2020, according to preliminary data, entered the top ten largest markets in the world due to a relatively small drop in sales, the Association of European Businesses (AEB) reported. Sales of passenger cars and light commercial vehicles decreased by 9.1% to 1.6 million units over the year. In December, sales decreased by 2.1% YoY to 167 thousand units.

Worldwide, car sales in 2020 fell in all major markets except South Korea.

At the same time, only Russia and China showed a drop of less than 10%. At the height of the epidemic in April and May, sales fell by 50-70%, but in the summer showed signs of recovery and moved to strong growth in the fall.

High volatility in the palladium market remains-at the end of last week, prices rose sharply to $2,433 / oz. after which they fell to $2,380/oz. Since about September 2020, the market has been consolidating in the range of $2 200 – 2 500/oz.

UBS estimates that platinum prices will reach $1,250 / oz by the end of 2021, while palladium prices will reach $2,900 / oz. The bank expects a 300,000-ounce deficit in the palladium market in 2021.

According to Reuters, over the past week, investments in the largest ETFs investing in platinum increased by 0.4%, while those investing in palladium were unchanged. In December, investments in ETFs of funds investing in platinum increased, while those investing in palladium declined. By the end of 2020, investments in the largest platinum ETFs fell by 10.8%, and in palladium funds-by 12.0%.

February is a seasonally favorable month for the strengthening of the ruble

The dollar was the strongest currency of the Big Ten following the results of the Asian session and the start of trading in Europe on Friday. There was a risk-off sentiment in the market, driven by doubts about the effectiveness of the vaccine. Although at the end of Thursday, the US currency weakened against all G10 competitors, with the exception of the yen and the Canadian dollar, amid the observed risk appetite.



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Europe and the United States have been slow to succeed in defeating the pandemic globally.

The Asian region, led by China, was the driver of global economic growth, as the second wave of the coronavirus was limited to local outbreaks, and it was not necessary to introduce painful lockdowns, which could form fears of a decline in economic activity. However, the Lunar New Year is ahead in February, which implies an increase in the movement and contacts of citizens.

Friday is the last trading day of January. Technical flows associated with the balance sheet rebalancing at the end of the month form an increased demand for the US currency today. The approaching February is a seasonally strong month for the dollar, which may be further strengthened by fears of the spread of the coronavirus in Asia. In general, over the past 20 years, the dollar index has risen in price by the end of February 11 times, over the past 10 years — 6 times. However, in the previous 4 years, the dollar strengthened every February, and in 2018 and 2017 quite solidly — by 1.7% and 1.6% per month, respectively, with an average 20-year growth in February at 0.21%.

The German Vaccination Commission has questioned the effectiveness of the AstraZeneca vaccine for the elderly over 65. First, this news has put pressure on the euro, as the risk of a more serious and prolonged vaccine shortage in the European Union increases. Second, the news caused the Aussie dollar to underperform the Big Ten on Friday afternoon, as AstraZeneca vaccines are part of a nationwide vaccination program in Australia.

Technically, the dollar index may close above the 50-day moving average line today for the first time since early November, when it became known that Joe Biden won the US election. We still see the risk of a short-term strengthening of the dollar as part of the correction, but we maintain a bearish view of the US currency in the medium-term horizon.



The ruble on Friday at noon fell against the dollar by about 0.3% to 76.18. This was the worst result among all currencies in the Emerging Markets segment. Nevertheless, at the end of the week, the Russian currency, which weakened against its American rival by 1.1%, looked much better than the Chilean, Colombian, Mexican peso, as well as the South Korean won.

The seasonal statistics of February in the USDRUB pair look somewhat different: over the past 20 years, the ruble has strengthened against the dollar in 12 cases in February, supported by a seasonally strong current account. For six consecutive years from 2003 to 2008, all of February ended in favor of strengthening the Russian currency. However, in the last three months of February, from 2018 to 2020, the ruble fell against the dollar in the last month of winter. Three February in a row — so far this is the most successful series for the dollar.

The weakness of the ruble in January was mainly due to two factors:

expectations of a reduction in the key rate have disappeared from the market and the demand of non-residents for OFZ remains scanty, the Bank of Russia has moved from daily sales of the currency to its purchases within the budget rule. The geopolitical premium in the ruble also increased in January, but its impact is quite insignificant.


If the yields on 10-year OFZs ended December at 5.91%, now it is already 6.28%, and the yields on the middle and far side of the curve are already close to becoming attractive for purchases again. The geopolitical risk premium, in our opinion, should leave the ruble in February and with the stability of oil prices (Brent about $55 / bbl), the ruble may well visit the range of 73.00 — 70.00 and settle in it. Of course, such expectations imply that there will be no collapse in global markets. We do not rule out a correction in stocks, but a collapse is not included in our baseline scenario for the coming months.

Records of Visa and MasterCard: the increase in online spending

Visa released its results for the first quarter of the fiscal year after the end of the regular trading session on Thursday.



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Key points of the Visa report for the 1st fiscal quarter:
Earnings per share $1.42 vs. $ 1.46 a year earlier, consensus $ 1.28
Net revenue +12% QoQ and -6% YoY to $5.7 billion, forecast $5.52 billion
Cross-border transaction volume: -21% YoY vs. +9% a year earlier, forecast -25% YoY

Total Visa card payments: +4% YoY, forecast +3.67% yoy
Volume of payments excluding currency fluctuations: +5% YoY vs. +8% yoy a year earlier, forecast +6.39%
As the Covid-19 pandemic continues to create significant uncertainty in the global economy, the company has not released its forecast for the full fiscal year.

Visa shares rose 1% to $200.87 in the extended session after the end of regular trading on Thursday. Following the results of the regular trading on Thursday, the company's securities rose by 1.67% to $198.22. For Visa shares, 36 recommendations - "buy", 6 recommendations - "hold", 0 - "sell", according to data in the Bloomberg terminal. The 12-month consensus forecast is $237.89. This implies a potential increase of 20% to the closing price on Thursday, January 28.

At the same time, MasterCard shares ended Thursday trading up 2.8% to $324.28. The company released its report for the 4th quarter of 2020 in the afternoon, and its results were fully played out during the session.

Key points of the MasterCard report for the 4th financial quarter:

Adjusted earnings per share $1.64 vs. $ 1.96 a year earlier, consensus forecast $1.51
Earnings per share were $1.78 compared to $2.07 a year earlier
Net revenue -6.8% YoY to $4.1 billion, forecast $4 billion
Cross-border transaction volume: -29% YoY vs. +16% yoy
The total volume of payments using MasterCard: +4% yoy, consensus +6.1% y / y

Total MasterCard payments denominated in local currency: +1% to $1.747 trillion.

The growth of online spending during the New Year holidays is countered by the negative impact on income of the very fact of reducing international travel. Both Visa and MasterCard showed a smaller decline in revenue for the last 3 months of calendar 2020 than analysts expected.

And this is despite the fact that the volume of cross-border transactions on their cards decreased by 21% yoy (Visa) and 29% yoy (MasterCard). Namely, the volume of cross-border transactions is the most profitable for companies. However, Mastercard and Visa, in an effort to revive card spending, which has fallen due to a reduction in people's travel, have benefited from users making more purchases online.