Comment of the Day
Video commentary for January 26th 2021
A link to today's video commentary is posted in the Subscriber's Area.
Some of the topics covered include: Fed's hawkish tone suggests an additional correction for stocks is about to be priced in. Wall Street reverses an earlier bound, Dollar surges, gold pulls back, both oil and copper pause, Europe continues to exhibit relative strength, banks and agriculture stocks steady.
Eoin's personal portfolio: one short stopped out and profit taken January 25th 2022
My view - One of the questions subscribers as most often is how to find details of my open traders. To make it easier I will simply repost the latest summary daily until there is a change.
London Gets Vote of Confidence From Big Finance Firms, EY Says
This article from Bloomberg may be of interest to subscribers. Here it is in full:
Most global finance firms are planning to establish or expand operations in the U.K. in 2022, according to a survey of 40 key decision-makers in the industry.
Around 87% of global financial services investors expect to invest in the U.K. next year, EY’s latest poll found. That’s the highest since the professional services firm started tracking sentiment toward the country in 2016, the year of the Brexit vote, and compares to 50% in early 2021 and a low of 11% in 2019.
The data is a boost for the City of London, whose credentials as an international finance center are being questioned since the U.K. left the European Union. Meanwhile, 90% of respondents said the U.K. offers the right conditions to invest in assets with environmental, social and governance attributes.
“This is testament to the stability and resilience of the mature U.K. market which continues to ably withstand the material challenges and uncertainty of both the pandemic and Brexit,” said Anna Anthony, EY’s financial services managing partner for the U.K.
My view - There was a lot of fear that Brexit would result in London being denuded of financial firms. The reality is the Eurozone represents only a portion of the business done in one of the world’s great financial centres.
The New Agri-Giant Invading the U.S. Heartland
This article from Bloomberg may be of interest to subscribers. Here is a section:
Viterra (TSX:VT) is already the world’s largest wheat trader, thanks to its investments in major exporting regions including Canada, Australia, Argentina, and the former Soviet Union. If Gavilon in the U.S. is added to that impressive portfolio, it will be the kind of concentration — and power — that governments worry about. Indeed, Beijing may be even more concerned about the deal than Washington. China, which is spending billions of dollars to build its own state-owned agricultural trading house, is unlikely to welcome further consolidation in an industry it relies on to feed more than one billion people.
Regulatory concerns aside, the deal is a steal. Glencore, founded by the late U.S. fugitive Marc Rich in the 1970s, built its agribusiness through acquisitions. In 2012, it beat out ADM and purchased Canadian grain trader Viterra Inc. for 6.1 billion Canadian Dollars ($4.8 billion). Today, Glencore controls just under 50% of the enlarged Viterra business, with 49% owned by two Canadian pension funds and a residual percentage controlled by the staff.
My view - Most investment banks closed their commodity trading desks during the 2011-2016 bear market. They sold their ships and warehouses too so getting back to dominant positions is not going to be easy or cheap. That handed control of market making to private trading houses which now control the market regardless of whether Glencore’s bit for Gavilon is successful.
Microsoft's Shares Gain on Forecast For Azure Cloud Growth
This article from Bloomberg may be of interest to subscribers. Here is a section:
Microsoft Corp. shares rose in early trading on Wednesday after the software giant gave a forecast that reassured investors the company’s Azure cloud-computing business still has potential to drive growth. The company predicted Azure’s revenue growth rate would pick up in the fiscal third quarter from the second, excluding the impact of currency fluctuations. The stock gained about 5% in premarket trading in New York. “This will help calm Street tech growth worries,” said Dan Ives, an analyst at Wedbush.
Microsoft’s fiscal second-quarter earnings report on Tuesday showed sales that topped $50 billion for the first time and profit that exceeded analysts’ estimates, fueled by cloud, gaming and Windows software. But Azure revenue, up 46% in the period, decelerated from recent quarters and missed analysts’ rosiest estimates, sending the stock tumbling before executives issued a more optimistic forecast for the business later in the afternoon.
My view - When I was recording the audio last night Microsoft was down in after hours trading. Shortly afterwards, the company released a more upbeat opinion of what they think the next quarters will look like so the share rebounded. Nevertheless, growth in demand for cloud services is moderating which is to be expected following the mass adoption event that accompanied the pandemic.
The Chart Seminar 2022
With global vaccination rates rising, the prospect of anti-COVID pills on the horizon and the promise of travel restrictions being dropped, it is time to start thinking about venues for The Chart Seminar in 2022.
Please drop sarah@fullertreacymoney.com a line if you would be interested in attending an event next year, as well as your preferred location.
At present I am looking at a late May date for a London seminar and I am open to other times and locations subject to demand.
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