Buckle up, investors. Stocks, crypto, commodities tumble on taper fears
Bulls, you might want to head to the beach today for a nice distraction. It’s a rough one out there. From Tokyo to London, stocks are in a tailspin. U.S. futures don’t look much better.
Gold, crude and crypto? Yep, they too are slumping.
Yesterday, we got the news investors were dreading. A majority of Fed officials now feel it’s time to cut back on the bond-buying spree they initiated last March, the same one that’s been the equivalent of rocket fuel for equities over the past 16 months.
Yesterday’s sell-off was a broad-based one, with 450 members of the S&P 500 closing lower on the day. Judging by the U.S. futures, we’re looking at another similar drop at the open.
Let’s see what else is moving the markets.
- The major Asia indexes are again under pressure with the Hang Seng down 2.1% in afternoon trading with tech stocks leading the way lower.
- Alibaba shares hit a record low in Hong Kong at one point on Thursday as Beijing’s regulatory crackdown on the tech giants widens. The shares are off 5.2% in late trading, and are down nearly 30% so far in 2021.
- Toyota shares bombed lower by nearly 4% on a report the carmaker will need to slash production as the chips shortage worsens.
- The European bourses were under the cosh at the open, too, with the Stoxx Europe 600 down 2% in mid-morning trading. Utilities, up a mere 0.07%, was the lone sector in the green at the start.
- Shares in Mastercard were down 1.2% in pre-market trading as a mammoth class action lawsuit against the credit card provider moves to a new phase. The plaintiffs seek 14 billion pounds ($19 billion) in damages, Bloomberg reports.
- The U.S. futures picture ain’t a pretty one. That’s after all three major indexes fell sharply on Wednesday on fresh tapering concerns.
- Shares in Robinhood are down 12.2% in pre-market trading after the investing app told investors it expects trading revenues to decline in the current quarter. That wiped out the euphoria over its big top-line beat.
- Nvidia’s share are going in the opposite direction, up 2.3% in pre-market after the chips maker reported a big beat on profits.
- Unemployment claims come out before the bell today and the consensus is for 364,000 new claims in the past week, a new post-pandemic low.
- Safe-haven gold is down, trading around $1,780/ounce.
- The dollar is rallying as stocks sink. No surprise there.
- The rout in oil continues. Crude is down with Brent around $66/barrel, a three-month low.
- Bitcoin has fallen below $45,000, wiping out of all the gains from the previous seven days.
You say INNOVation. I say innoVATION. Let’s call the whole thing off
All about the Doge
Just to put that into perspective, a little over one in every four bucks in sales Robinhood booked last quarter came from a single type of trade: Dogecoin. And how are investors reacting to the revelation that $HOOD has become a veritable Dogecoin exchange? It’s down more than 12 percent in pre-market trading. Woof!
The new biggest short: Chinese tech stocks
A doubly-bad correction
The chart above is the Hang Seng Tech Index, which is down more than 40% since its February high. Woof, woof!
Have a nice day, everyone. I’ll see you here tomorrow… Until then, there’s more news below.
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