Weekly Excerpt 10/25/2021
Weekly summary from October 18 to 22
- The equity market closed for the third consecutive week in positive territory. Ten of the eleven S&P 500 sectors posted positive returns. The Real Estate +3.2%, Healthcare +2.8% and Financials +2.7% sectors have stood out, on the other hand the Communications sector has fallen -1%. The Dow Jones has managed to set new highs supported by industrial giants that have shown solid results.
- In Europe, the equity market has shown a mixed performance, with the Spanish Ibex 35 index suffering the worst decline in the week with -1.01%.
- Investors have become more concerned about higher costs and longer duration bottlenecks in the global supply chain that would push the Fed to raise interest rates faster than expected.
Read more
- The stock market has shown strength beyond investor concerns over global supply chain issues. For now, 84% of companies have reported earnings per share above estimates, a figure that is above the five-year average of 76%. Additionally, reported earnings are 13.4% above estimates, a figure that is above the five-year average of 8.4%.
- Fed Chairman Jerome Powell has mentioned that he believes the U.S. central bank should begin tapering its purchase program soon, but that interest rates should not yet be raised because the jobs recovery is still weak.
- The week was highlighted by the start of trading of two ETF's with exposure to bitcoin in the United States. The first was the Proshares index fund, which went public on Tuesday under the ticker of BITO US. The high trading volume achieved on its first day has placed it in second place all-time.
America
| AMERICA | QUOTE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| DOW JONES INDUS. AVG | 35.677,02 | 1,08% | 16,57% |
| S&P 500 INDEX | 4.544,90 | 1,64% | 21,00% |
| NASDAQ COMPOSITE | 15.090,20 | 1,29% | 17,08% |
Europa
| EUROPE | QUOTE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| Euro Stoxx 50 Pr | 4.188,81 | 0,14% | 17,91% |
| FTSE 100 INDEX | 7.204,55 | -0,41% | 11,52% |
| CAC 40 INDEX | 6.733,69 | 0,09% | 21,30% |
| DAX INDEX | 15.542,98 | -0,28% | 13,30% |
| IBEX 35 INDEX | 8.906,40 | -1,01% | 10,31% |
| SWISS MARKET INDEX | 12.056,21 | 0,79% | 12,64% |
Asia
| ASIA | QUOTE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| NIKKEI 225 | 28.804,85 | -0,91% | 4,96% |
| HANG SENG INDEX | 26.126,93 | 3,14% | -4,05% |
| CSI 300 INDEX | 4.959,73 | 0,56% | -4,83% |
Bonds
| BONUS | QUOTE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| US TREASURY 10Y | 1,63 | 3,96% | 90,66% |
| US Generic Govt 2 Yr | 0,45 | 14,81% | 195,76% |
| GERMANY 10 YR | - 0,11 | 36,92% | 81,45% |
| UK 10 Yr | 1,15 | 3,60% | 303,17% |
Commodities
| COMMODITIES | QUOTE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| WTI | 83,76 | 1,80% | 72,63% |
| BRENT | 85,66 | 0,94% | 65,37% |
| NATURAL GAS | 5,28 | -2,40% | 107,96% |
| CORN | 538,00 | 2,33% | 11,16% |
| WHEAT | 756,00 | 3,00% | 18,03% |
| GOLD $/oz | 1.795,50 | 1,60% | -5,26% |
| SILVER $/Oz | 24,45 | 4,71% | -7,43% |
| COPPER | 449,80 | -4,89% | 27,82% |
| PLATINUM | 1.043,99 | -1,38% | -2,62% |
Coins
| COINS | QUOTE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| EURUSD | 1,16 | 0,36% | -4,69% |
| AUDUSD | 0,75 | 0,61% | -2,96% |
| CADUSD | 0,81 | -0,02% | -2,88% |
| CHFUSD | 1,09 | 0,78% | 3,52% |
| GBPUSD | 1,38 | 0,03% | 0,62% |
| CNYUSD | 0,16 | 0,80% | -2,18% |
| JPYUSD | 0,01 | 0,67% | 9,85% |
| USDBRL | 5,65 | 3,45% | -7,99% |
| USDMXN | 20,18 | -0,73% | -1,31% |
| USDCOP | 3.774,11 | 0,18% | -9,12% |
| XBTUSD | 60.726,00 | -2,88% | 109,43% |
To keep in mind during the week
- Investors' attention will be focused on a week full of corporate results; more than 25% of the companies that make up the S&P 500 will present economic reports for the third quarter of the year. The large companies in the technology sector such as Apple, Amazon, Facebook, Alphabet and Microsoft, among others, will stand out.
- The week is expected to see what impact the damage could have on the supply chain when U.S. growth data is released. Analysts' estimates forecast GDP growth of 2.8% a figure well below the 6.7% of the previous three months.
- Treasury Secretary Janet Yellen has mentioned that she expects price increases to remain high during the first half of 2022, but believes that the U.S. is not at risk of losing control of inflation but that raising the U.S. debt ceiling is essential.
- Joe Biden is close to fulfilling what his supporters consider the historic promise of his presidency in the coming days, as after weeks of negotiation between moderate and progressive Democrats the bipartisan infrastructure program could finally come to fruition this week. The plan is expected to get billions of dollars in funding to curb global warming included in the plan, which would provide a major boost for the president at the G20 summit in Rome and the United Nations climate summit in Scotland.
Other important points
- The European Central Bank will hold a new meeting on Thursday, investors will be watching for any comments from the authorities that could indicate any adjustment to monetary policy considering that inflation in the euro zone has reached the highest levels in thirteen years. It is expected that if under pressure from the Fed and the Bank of England to tighten, the ECB will follow suit.
- Evergrande has been able to avoid default after transferring the US$83.5 million needed to pay the coupon on a month-old overdue bond. According to a Reuters report, the company has managed to resume work on more than 10 projects in six different cities. In the short term, the company has overdue coupon payments of US$195 million due on October 29 and November 10.
- China expects a new outbreak of COVID-19 to worsen in the coming days and authorities have ordered affected areas to adopt an "emergency mode". The current outbreak has caused infections to spread to 11 provinces.
- Economists believe that China's economy is at risk of slowing down faster than expected, in the face of a combination of President Xi Jinping's drive to reduce its dependence on the real estate sector and regulate different sectors from education to technology, with energy shortages and the impact of the pandemic.
- Last Wednesday Bloomberg had advanced that there were talks by PayPal to acquire Pinterest mainly through shares. However, on Sunday night the payments company announced that it is not pursuing a stock to acquire Pinterest Inc at this time.
Economic Calendar
Before market opening
| Monday 25 | Tuesday 26 | Wednesday 27 | Thursday 28th | Friday 29 |
|---|---|---|---|---|
| Otis | UPS | Boeing | Shopify | ExxonMobil |
| Kimberly-Clark | General Electric | General Motors | Caterpillar | Abbvie |
| Bank of Marin | 3M | Coca-Cola | MasterCard | Chevron |
| Travel Zoo | Lilly | McDonalds | Merck | Phillips |
| Bank of Hawaii | Waste Management | Spotify | Altria | Cameco |
| Teva | Comcast | Royal Caribbean |
After market close
| Monday 25 | Tuesday 26 | Wednesday 27 | Thursday 28th |
|---|---|---|---|
| AMD | Ford | Apple | |
| Logitech | Microsoft | Teladoc | Amazon |
| PCA | Alphabet | Twiio | Starbucks |
| Crown | Visa | Align | Gilead |
| Upwork | MicroStrategy | ||
| Robinhood | Ebay | Skechers |
Economic Calendar
Monday 25
ALE: Ifo index of business confidence in Germany
BRL: BCB Target Market Report
Tuesday 26
USA: The Conference Board Consumer Confidence
USA: New Home Sales Data
Wednesday 27
CAD: Bank of Canada Monetary Policy Report
USA: IEA crude oil inventories
USA: Durable goods orders
Thursday 28th
JPY: BoJ Monetary Policy Statements
EUR: ECB interest rate decision
USA: GDP Data
USA: New claims for unemployment benefits
Friday 29
ALE: GDP data
EUR: CPI data
