Market Notes

Market Update – May 19/21

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Stocks

US stocks closed mixed and Treasury yields rose as minutes showed Federal Reserve officials were cautiously optimistic about the US recovery at their April meeting, with some signaling they’d be open ‘at some point’ to discussing scaling back the central bank’s massive bond purchases.

The S&P 500 fell for a third day, and 10-year Treasury yields jumped to session highs following the release. Energy and raw-material stocks fell the most as commodities prices tumbled amid mounting concern about inflation and potential curbs on monetary stimulus. The Nasdaq 100 notched a small advance, boosted by late-day gains in tech stocks including Facebook and Alphabet.

Strong inflation readings and signs of a worker shortage in recent weeks have fueled fears and roiled stock markets despite reassurances from Fed officials that the rise in prices would be temporary.

Note on the chart below that the previous low for the S&P 500 on May 12th held. This suggests that we should see a rally from here, provided there is not some new negative news. We are looking for a potential high of 4265 in the next two weeks.

Crypto

Digital currencies fell sharply after China’s banking association issued a warning over the risks associated with digital currencies. A statement posted on the industry association’s website said all members should ‘resolutely refrain from conducting or participating in any business activities related to virtual currencies.’

Below is Bitcoins’ 24-hour chart and we can see what a wild ride it was.  At just before 5:00pm last night Bitcoin was trading at $43,596, then 12 hours later it was down to $30,00, before rallying back to $42,434, 4 hours later. Bitcoin finished the 24-hour day at $39,161.

Gold

Gold had a solid day, up $13.50. Gold has now broken out of both its downtrend channel, and its near-term resistance (horizontal red dotted line). At the bottom of the chart, we can see that gold is now technically overbought, suggesting a near-term top is to be expected.

Stay tuned!

Headlines – May 14/21

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  • Civil War in Israel? Read story
  • People are panic buying houses as prices skyrocket around the world. Read story
  • Fully vaccinated? You can ditch the mask, CDC says. Read story
  • CN Rail is close to US$33B deal with K.C. Southern. Read story
  • Greyhound Canada is permanently shutting down, ending almost a century of bus service. Read story
  • The IRS is coming for Crypto investors who haven’t paid their taxes. Read story
  • China exporters pass higher costs on to customers around the world. Read story
  • Elon Musk has lost $20 billion since hosting SNL. Read story
  • Billionaires are selling mega-sized stock blocks after surge. Read story
  • Pentagon surveilling Americans without a warrant, senator reveals. Read story
  • Lebanon loses a quarter of its electricity supply over lack of payment. Read story
  • Ferraris for the people: luxury goods now sold in fractions. Read story
  • Ford wants billboards to beam distracting ads to screens inside your car. Read story
  • This facial recognition website can turn anyone into a cop – or a stalker. Read story
  • ‘Jeopardy!’ ratings still high after Trebek – Here’s how the guest hosts stack up. Read story
  • Actress is auctioning an NFT about her vagina. Read story
  • Worst-case scenario’ warning for retirees and the 4% rule. Read story
  • Having a healthy heart is associated with better problem-solving and reaction time. Read story
  • The best places to retire in 2021. Read story
  • On the lighter side. Check it out
Market Notes

Market Update – May 13/21

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For the past couple of months, we have been highlighting how we do not have confirmation from all markets as to what direction they are heading. In particular, we want to look at the different action in the Dow Jones Industrial Average (blue chip stocks), and the Nasdaq (tech stocks).

The Dow is testing its near-term consolidation support level, but so far it is holding. Also, it has not yet tested its 50-DMA (wavy blue line) or its longer-term trend line (green dashed diagonal line).

When we look at the Nasdaq, we can see that it has fallen below its near-term consolidation support level (green horizontal line), and its 50-DMA (blue wavy line). It is also now testing its longer-term trend line (green dashed diagonal line).

As investors, we need to remember that these are global markets, and while North American investors tend to stick to smaller cap and tech stocks, international investors and institutions tend to go to blue chip  stocks. With rising tensions with Israel-Palestine, US-Iran, China-Taiwan, Russia-Ukraine, international investors have been favouring the Dow Industrials, while the domestic investors have been selling the small cap and tech stocks.

We need to keep our eye on this development and see if the Nasdaq pulls the Dow down, or if the Dow sets the trend higher. We need to see if the Nasdaq can hold above its longer-term trend line. If it closes below that trend line tomorrow, that would open the door for a more significant decline.

Stay tuned!

Market Notes

Market Update – 05/12/21

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The markets had a lot to contend with today. Inflation in April accelerated at its fastest pace in more than 12 years as the US economic recovery kicked into gear and energy prices jumped higher, the Labor Department reported Wednesday.

The Consumer Price Index, which measures a basket of goods as well as energy and housing costs, rose 4.2% from a year earlier. A Dow Jones survey had expected a 3.6% increase. The month-to-month gain was 0.8%, against the expected 0.2%.

Also on the minds of investors is the troublesome situation with the Colonial Pipeline, where a ransomware attack forced one of the US’s largest oil transporters to shut down, exposing vulnerabilities in America’s infrastructure and sparking gas panic buying across the southeast. The result of the shutdown is 70% of gas stations in North Carolina are out of gas.

Then there is the worst escalation of armed conflict between Israel and Palestine.

The combination of all these issues sent Wall Street running for the exits, with the S&P 500 seeing its biggest one-day drop since February. The S&P 500 was down 89.06 points, or 2.14%.

The Nasdaq was hit harder, down 357.75 points, or 2.67%.

The hardest hit US market was the Russell 2000, down 3.25%.

The Canadian TSX index  on the other hand was only down .45%.

Gold also sold off today, down 13.30 or .72%.

While we do not believe at this time that this is the top for this 12-year bull market,  it could be a turning point, where we see a significant pull back or correction. Understand that this massive bull market WILL end, they all do. Be sure you have a plan in place to protect your wealth in the event of a serious market correction. If you need assistance, our Trend Technical Trader service was originally designed as a hedging service, to actually make money on market declines.

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Headlines – May 12/21

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  • Investors spooked as consumer prices rise 4.2% in April. Read story
  • Pipeline shutdown, panic-buying, force 1,000+ gas stations to run out of fuel.  Read story
  • Loonie hits highest level since 2015 amid commodity strength. Read story
  • Line 5 shutdown will disrupt Canada’s energy security, Ottawa says, as Michigan threatens Enbridge if it defies order. Read story
  • Ark’s Cathie Wood predicts ‘serious correction’ in commodities. Read story
  • Freaked-out Canadians open to rate-hike to cool housing market.. Read story
  • Companies are being held to ransom. Should they pay to get back online? Read story
  • CDC grossly exaggerating outdoor transmission rate: COVID-19 experts. Read story
  • Influential Republicans threaten to form new party. Read story
  • ‘CDC’s credibility is eroding’ amid conflicting mask guidance, ex-Obama official says. Read story
  • Tesla’s weak sales in China worry investors. Read story
  • EBay taps into NFT frenzy, allows sales on platform. Read story
  • Why everyone is stressing out about rare earth metals. Read story
  • According to Swedish researchers, having children is one of the most destructive things you can do to the planet. Read story
  • Amazon wins $3 million court fight in blow to EU tax crusade. Read story
  • Here’s the net worth Americans say you need to be considered wealthy. Read story
  • Researchers’ new best friend? Robot dog gets to work. Read story
  • These electric farming tractors could make farming much greener. Read story
  • The sound of the universe is being detected by Voyager 1 space probe. Read story
  • On the lighter side. Check it out

 

Hands Free ? – no, not really

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There are many uses for biometric security measures, using scanners that recognize a person’s fingerprints, thumbprints, and iris, for example. Hand-held wands and full body scanners are quite commonplace in airports, and other locations where security is important for detecting and mitigating risk. Most of us accept the need for this technology, even though it may seem somewhat invasive. We live in a world where threats are more common, and most people are willing to give up an ounce of privacy to gain a pound of security. Biometric scanning technology has advanced a great deal in recent years, but can scanning technology do more than detect risk or provide secure access to a facility?  Amazon thinks it can.

In 2019 Amazon developed a patented scanning technology that takes biometrics in another direction, where your palm serves as your credit card. The original scan of your palm, saved on a secure Amazon cloud server, becomes your verification for purchases on your Amazon credit account. The scan apparently includes many details of your palm, such as lines, creases, veins, bones and other structural features beneath the skin. The Amazon palm scan is proprietary and patented, so deep dive technical details are not available.  Amazon is now testing the system in a Whole Foods store in Seattle, after successful use in several Amazon Go stores last year. This new payment system is named AMAZON ONE.

The union representing many Amazon workers claims that this technology is another way for Amazon to eliminate jobs, so job security is part of the discussion, but so is system security. Experts in cyber security point out some of the risks inherent with this system. First is the security of the cloud server, as a hack of the server could expose your palm scan, and lead to that scan being stolen and used nefariously. Other credit verification systems use “replaceable” items, so that if the item is ever compromised it can be replaced. For example, if your credit card is compromised, the card provider will cancel the compromised card and issue a new card with all new numbers, and most providers will guarantee no loss to you if the card is lost, stolen, or otherwise compromised. That’s a very solid system, but what can be done about a compromised palm print? Probably not much, seeing as we all want to keep our palms right where they are – no one is going to easily issue a new one for you.  We all know about book and movie plots where thumbs, fingers, and eyes are “removed” from their owner in order to gain access to a facility secured with biometric scanners. The plots might get a little more bizarre now that palm scans are in the mix.

There are two main drivers for the Amazon One system – convenience, and the perceived need for contact-less purchase verification during a pandemic. The palm reader works by hovering your hand over the reader without touching anything, which meets the need for “no contact”. On the convenience side, this technology allows the customer to make a purchase, on credit, without carrying a credit card, or a wallet or purse to carry it in. We expect the “technology for the sake of convenience” debate to  scale up a bit more, now with Amazon One to illustrate a point.

The aim of TREND DISRUPTORS is to discover, explore, and monitor scientific and technical developments, looking for the best and brightest ideas, so that we can publish useful, actionable, investment recommendations for our subscribers. These kinds of recommendations are speculative, and we advise caution, discretion, and thorough research. TREND DISRUPTORS strives to identify investment opportunities that can lead to success for the well informed investor.    Stay tuned !

 

 

 

 

Bill Gates says ‘No’ to sharing vaccine formulas with global poor to end pandemic

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Bill Gates, one of the world’s richest men and most powerful philanthropists, was the target of criticism from social justice campaigners on Sunday after arguing that lifting patent protections on COVID-19 vaccine technology and sharing recipes with the world to foster a massive ramp up in manufacturing and distribution—despite a growing international call to do exactly that—is a bad idea.

Directly asked during an interview with Sky News if he thought it “would be helpful” to have vaccine recipes be shared, Gates quickly answered: “No.”

Asked to explain why not, Gates — whose massive fortune as founder of Microsoft relies largely on intellectual property laws that turned his software innovations into tens of billions of dollars in personal wealth — said: “Well, there’s only so many vaccine factories in the world and people are very serious about the safety of vaccines. And so moving something that had never been done — moving a vaccine, say, from a [Johnson & Johnson] factory into a factory in India — it’s novel — it’s only because of our grants and expertise that that can happen at all.”

Contrary to Gate’s claims, there are facilities available to produce hundreds of millions of COVID-19 vaccines. In an industrial neighborhood on the outskirts of Bangladesh’s largest city lies a factory with gleaming new equipment imported from Germany, its immaculate hallways lined with hermetically sealed rooms. It is operating at just a quarter of its capacity.

It is one of three factories that The Associated Press found on three continents whose owners say they could start producing hundreds of millions of COVID-19 vaccines on short notice if only they had the blueprints and technical know-how. But that knowledge belongs to the large pharmaceutical companies who have produced the first three vaccines authorized by countries including Britain, the European Union and the U.S. — Pfizer, Moderna and AstraZeneca. The factories are all still awaiting responses.

Across Africa and Southeast Asia, governments and aid groups, as well as the World Health Organization, are calling on pharmaceutical companies to share their patent information more broadly to meet a yawning global shortfall in a pandemic that already has claimed over 2.5 million lives. Pharmaceutical companies that took taxpayer money from the U.S. or Europe to develop inoculations at unprecedented speed say they are negotiating contracts and exclusive licensing deals with producers on a case-by-case basis because they need to protect their intellectual property and ensure safety.

Read AP article here.