Investors cheer a more hawkish Fed, igniting a global tech stocks rally

Good morning, Bull Sheeters.

Whoever had three 2022 rate-hikes on their Fed bingo card, congratulations! The very-limited edition “Bull Sheet” beach towel is in the mail.

Investors on Thursday are cheering the Federal Reserve’s long-awaited taper-then-tighten policy shift. U.S. futures have been gaining throughout the morning, following Europe higher. What you might find most surprising is tech stocks. They lead the futures board higher.

Most risk assets are gaining this morning: stocks, crude, commodities. Crypto, however, is only modestly higher.

In today’s Buzzworthy section, we look closer at the latest Fed move, Omicron cases, and sinking SPAC market.

But first, let’s see what’s moving markets.

Markets update


  • The major Asia indexes were mostly higher on Thursday. The Nikkei, the best of the bunch, closed 2.1% higher while Hong Kong stocks rebounded down the stretch to eke out a gain.
  • Chinese stocks are this year’s big under-performer. But there are some calls for a big 2022 turnaround. The latest comes from JPMorgan Chase, which sees a 40% jump next year for the MSCI China.


  • The European bourses had one of their best opens in weeks, with the Stoxx Europe 600 up 1.1% two hours into the session. Every sector was in the green out of the gates.
  • London is fast becoming a ghost town. The pound sterling is under threat. Omicron is surging in the U.K., as is inflation. Add it all up, and we could see a rate-increase today from the Bank of England, economists say.
  • Shares in Airbus were up 4% at the open after the French plane-maker beat out Boeing to supply a new batch of 20 jets to Australian airline Qantas in a multi-billion-dollar deal.


  • U.S. futures point to a strong open. That’s after all three major averages rallied yesterday afternoon following the Powell presser. Tech stocks led the way higher.
  • Speaking of tech and stocks… Reddit, where Bull Sheeters go for stock tips (okay, maybe just my nephew), has quietly filed to go public, which means you could buy shares in the platform that brings you WallStreetBets, AskScience and Explain Like I’m Five.
  • They’re calling it the great “policy pivot.” The Federal Reserve now sees the winding down of its epic bond-buying program by March and not one, not two, but three rate hikes next year. Following the news, just one sector—energy—finished lower yesterday.


  • The taper news is good news for gold. It trades higher, around $1,785/ounce.
  • The dollar, at first, jumped at the first hint of tighter Fed policy. It’s since fallen back some.
  • Crude is up, with Brent trading back near $75/barrel.
  • Bitcoin is trading sideways. Again. It sits just below $49,000—flat over the past week. Ether is doing a bit better in comparison, up above $4,000.



Hiking season

BofA Securities is among those who are bringing forward their forecasts for rate hikes following the conclusion of yesterday’s FOMC meeting. Even with the more aggressive pace, BofA thinks the Fed is behind the curve.


R.I.P. “Transitory” inflation

“The realities of higher inflation have finally hit the Fed.” That’s the big headline in Berenberg’s investor note following yesterday’s Powell press conference. The lower-for-longer rates-policy is no match for to-the-moon prices. And, so, even central bankers have to shift gears and hike borrowing costs from their rock-bottom levels.


Missed out on the SPAC frenzy? Don’t give it a second thought

The SPAC ETF rallied yesterday (along with everything else), but it’s still in bear market territory, YTD.



The booster drive is in full swing in the world’s richest economies. For those slow on the draw, the latest U.K. surge could be a glimpse of what other countries will face.




This one’s for Patti, a Bull Sheet reader in Florida who sent me a poignant note yesterday about her lifelong love of a nice home-cooked pasta meal.

Last year, lockdown rules forced us to break with Christmas tradition and celebrate at home. It was just my wife, me and the kids.

Rather than feast on my mother-in-law’s renowned faraona (guinea fowl) in salmi, cappelletti in brodo and terrine, we all rolled up our sleeves and made the meal ourselves.

This year we’ll be back in Umbria, but the Warner family will be in charge of making the cappelletti.

Warning: It requires a team of pasta elves and plenty of uncluttered kitchen space. (If you have a curious dog, too, put the pooch on the porch for this).

You start with a simple pile of flour, salt and eggs. You mix that into a yellowish paste that becomes, with enough kneading, a doughy glob of pasta. That glob gets passed to elf No. 2 who, with a rolling pin, flattens it into a kind of sheet. Elf No. 3 (this will probably be me) feeds the fresh pasta strip into a little metallic press. Crank, crank, crank, and the strips grow thinner and thinner as it emerges from the other side.

The cappelletti pasta has to reach a kind of Goldilocks level of thickness. Otherwise, Elf No. 4 will give you all kinds of grief.

At the final workstation, the sheets of pasta are laid out on the table where the next little helper carves out flat little circles. How little? Maybe a little bit bigger than the circumference of the lens in my reading glasses. Capite?

You then take a pinch of ripieno, a meaty filling—usually some combo of minced veal, minced chicken, minced pork and parmigiano reggiano—and plop it onto the center of the little yellow disc. Fold that pasta disc in half. Cinch down the edge, and rotate the pasta in a clockwise fashion so the meaty center won’t slide out. You’ll have a half moon in your hand. Fold one more time by bringing the right corner and left corner together. Eccolo! You’re done.

Original photo: Bernhard Warner

(Here’s why you need the pasta to be of a just-right thickness. Too thin, and the ripieno pierces the pasta, and you have to start over. Too thick and the whole pasta-to-ripieno ratio gets thrown off.)

The end product should look like a little hat—hence, the name cappelletti. Pro tip: Don’t call them “tortellini” in Umbria. Them’s fighting words.

We made several hundred cappelletti last year, and froze them. Making any less just doesn’t work out on a value-for-money cost-benefit analysis basis.

Anyhow, here’s what they look like in the bowl.

Original photo: Bernhard Warner


Have a nice day. I’ll see you here tomorrow… Until then, there’s more news below.

Bernhard Warner

As always, you can write to or reply to this email with suggestions and feedback.

Today's reads

Here’s how the worker shortage is contributing to sky-high inflationFortune

Elon Musk has sold nearly 12 million shares of Tesla in the past six weeks—and he may have cashed out at the topFortune

2022 Fortune Investors GuideFortune

There Are Scarier Things Than a Hawkish FedWall Street Journal

Market candy

Quote of the day

If I wanted to keep my money safe, I’d rather be keeping it in Amazon stock than Bitcoin.

That's Boston College finance professor Leonard Kostovetsky. He's crunched the numbers on "inflation hedge" investments, and found that gold and crypto—in particular, Bitcoin—"have been the two worst inflation hedges since 2013," my colleague Declan Harty writes.

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