Yazar: Geoffrey Smith
Investing.com – The war between retail investors on Reddit and Wall Street short sellers continues; GameStop will double again on opening. Jerome Powell will hold the first press conference since Joe Biden’s inauguration and now Janet Yellen is Treasury Secretary. Microsoft results set a high scale for Apple, Tesla and Facebook, and the EIA is publishing data on US oil stocks.
What you need to know in financial markets on Wednesday, January 27th:
1.Reddit rally continues
The extreme volatility generated by the war between the short sellers on Wall Street and the retail trade community gathered around Reddit’s chat board r / wallstreetbets shows no signs of compromise.
GameStop (NYSE 🙂 stock at the center of attention marks another 107% gain in pre-market trading after rising 22% on Monday and 93% on Tuesday. This puts the value of the losing video games, console and accessory dealer to over $ 20 billion.
Cinema operator AMC Entertainment (NYSE 🙂 also saw a 110% increase, while Express (NYSE 🙂 gained 35% and Blackberry (TSX 🙂 gained 10%. Users of the chat board seem to have targeted Gabe Plotkin’s Melvin Capital’s open positions as a battle of will and resources. On Tuesday, Melvin raised $ 2.75 billion in new funds from hedge fund veterans Steven Cohen and Ken Griffin through the Point72 and Citadel funds.
2.The Fed turns its rudder into a steady course
The Fed will conclude the Federal Open Market Operations Committee (FOMC). While neither interest nor asset purchase pace is expected to change, the attention will be on President Jerome Powell’s press conference.
Confidence in the Fed’s promise to maintain its pace of quantitative easing has recently returned. The general feeling is that the Fed is more afraid that tightening will happen too soon, rather than too late. Treasury yield returned from 1.16% last week to 1.04%.
3. Stock markets will be mixed; durable goods data will be published
US stock markets will be opened mixed. The technology is performing well, with Microsoft’s (NASDAQ 🙂 pretty strong quarterly figures.
It fell 149 points and fell 0.4%. However, it gained 0.3% as Microsoft climbed 2.7% to an all-time high.
Earnings reports may also take precedence over macro developments, with the market ignoring news of Donald Trump’s impeachment process outside the Fed. It will be shared at 08.30, local time for December.
Consumer confidence in France and Germany fell sharply under the pressure of increasing quarantine measures, while China’s industrial production growth accelerated.
4. Microsoft set the stage for strong earnings reports for tech companies
Cloud, PC spending, remote work, and video gaming all created a strong trio for Microsoft in the last quarter. In the second quarter of the financial year, there was a 30% increase in profit. Their sales increased by a staggering 17% to $ 43.1 billion, exceeding expectations by nearly 10%.
These numbers set the stage for big tech names to share similar numbers: at the close Apple (NASDAQ :), Facebook (NASDAQ 🙂 and Tesla (NASDAQ 🙂 will report.
At the start of the day, there will be names such as AT&T (NYSE :), Abbott Labs (NYSE :), Boeing (NYSE :), General Dynamics (NYSE :), Corning (NYSE 🙂 and Hess (NYSE :).
5.Oil is stable with rising Gulf tensions
Crude oil prices remained at high levels following reports that the US was preparing to increase its military power in Saudi Arabia in an environment of escalating tension with Iran. A day before the reports, an explosion sound came from the Saudi capital, Riyadh, and its origin has yet to be found with certainty.
The Islamic Republic has resumed enrichment of uranium in an obvious move to strengthen its negotiating position before Biden is reinstated in the Joint Comprehensive Action Plan from which Donald Trump was withdrawn, according to expectations.
prices remained steady at $ 52.63, up 0.1% at $ 55.70. The Energy Information Office (EIA) will share its data at the usual time.