What we’re reading (12/6)
“Stock Market Trends For 2022” (U.S. News & World Report). “The rise in interest rates is going to be a change for the markets. But it won’t necessarily hurt the appetite for investing in stocks. Rather, it could degrade the performance of some corners of the market, particularly growth stocks, which would favor value-oriented names, says James Ragan, director of wealth management research at D.A. Davidson in Seattle.”
“Dow Climbs More Than 600 Points Amid Renewed Volatility” (CNN Business). “‘We have quadruple expiration [of contracts] a week from Friday so we see those portfolios being changed around,’ [TD Ameritrade Chief Market Strategist J.J.] Kinahan told CNN Business. ‘And at the same time, it's the end of the year. The Nasdaq had a good run and people are repositioning for 2022.’”
“Stocks Get a Boost As Omicron Concerns Ease” (Wall Street Journal). “The S&P 500 recouped nearly all its losses for all of last week on Monday, and the Dow Jones Industrial Average more than regained what it had lost. Oil prices and bond yields also rose. Markets have whipsawed in recent days because of rising concerns about the new variant, which has clouded the market with uncertainty.”
“Why the Fed Chair Won’t Call Inflation ‘Transitory’ Anymore” (New York Times). “You might think the new Omicron variant of the coronavirus would make Powell and his fellow rate-setters reluctant to remove monetary stimulus. But while Omicron might cause the economy to grow more slowly, it won’t necessarily curb inflation. It could even make it worse if it suppresses the supply of goods and services — say, by forcing manufacturers and shippers to curtail operations. Powell cited ‘increased uncertainty’ about inflation as a result of Omicron in his prepared congressional testimony.”
“Why Have Prices Of Cryptocurrencies, Such As Bitcoin, Fallen—Again?” (The Economist). “The price of bitcoin, the world’s most popular cryptocurrency, fell by almost 20% at the weekend, from around $57,000 on December 3rd to $45,000 the next day (it has since partially recovered, to around $49,000). Other popular coins, including Ethereum, shed a similar proportion of their value. The market capitalisation of all crypto assets fell by $400bn to $2trn, before picking up slightly. Why did prices fall, and what makes cryptocurrencies so volatile?”
