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Good morning, Bull Sheeters.
U.S. Futures are climbing as investors look to snap a two-day losing streak. The catalyst is blockbuster earnings from Apple and Facebook, which are lifting tech futures this morning. Alas, all is not rosy. The global chips shortage is constraining iPad and iMac sales, the company warned.
Another tailwind for stocks is coming out of Washington. Last night in a joint session of Congress, President Biden called for a new spending plan, which brings the tally on his infrastructure/education/childcare/fiscal stimulus spending plans to roughly $6 trillion.
Speaking of trillions… The Fed’s balance sheet stands at roughly $8 trillion, and is heading in one direction: up, up, up after the central bank said it will keep asset purchases steady.
Let’s check in on what else is moving the markets.
Markets update
Asia
- The major Asia indexes are mostly higher in afternoon trading with the Hang Seng up nearly 0.8%.
- With deadly COVID cases spiking in India, the U.S. Department of State has called on all U.S. Citizens to leave the country as soon as possible. Stocks in India, however, are holding up remarkably well.
- There’s some upbeat breaking news on the COVID vaccine front: Vaccine-maker BioNTech predicts some kids could get the first jab as early as June.
Europe
- The European bourses were higher out of the gates this morning with the Stoxx Europe 600 up 0.4% in early trading, before climbing. Energy, retail and consumer products lead the way higher; auto shares are dragging down German stocks.
- Shares in Royal Dutch Shell were up 1.6% after the energy giant posted a bottom-line beat and boosted dividends.
- Continuing with this busy earnings week… Unilever is the latest corporate giant to join the share-buyback train after posting a top-line beat and maintaining strong forward guidance. Investors cheered the news, sending shares up 3.2%.
U.S.
- U.S. Futures are climbing. That’s after the three main averages faded down the stretch on Wednesday even as the Fed says it remains committed to the status quo of loose monetary policy.
- Futures contracts for Facebook (+6.2% in pre-market) and Apple (+2.8% in pre-market) shares are popping. Facebook on Wednesday crushed it on the top line. Meanwhile, monster iPhone sales lifted Apple’s bottom line.
- Today’s big batch of earnings include: Amazon, Mastercard and McDonald’s.
Elsewhere
- Gold is up, trading around $1,780/ounce.
- The dollar is up even with stock futures on the rise.
- Crude is up with Brent trading above $67/barrel.
- Bitcoin remains flat, trading above $54,000.
***
Buzzworthy
King copper
🚀
“Stonks only go up”
As my nephew reminded me via text, GME is up big in recent days. That always happens when your shares get diluted. Always.
🤦🏻♂️
Digital dove
🤷🏼♂️
Herd on the street
Over and over again, vaccination rates is the metric economists cite in presenting their bull case for economic growth. According to BofA economists, the U.S. Is on pace to hit 75% vaccination rate by late-June. The U.K., Canada and Singapore could hit that milestone later in the summer, and the European Union by early autumn.
A reminder: stock markets bulls are vaccine bulls.
💉 (this is a syringe emoji, but you get the idea)
***
Have a nice day, everyone. I’ll see you here tomorrow… Until then, there’s more news below.
Bernhard Warner
@BernhardWarner
[email protected]
As always, you can write to [email protected] or reply to this email with suggestions and feedback.
Today's reads
Houdini act. A series of toxic and over-leveraged trades sunk Archegos Capital Management, and seriously dented a number of Wall Street and European heavyweights. Deutsche Bank though adroitly avoided serious damage. My colleague, Christiaan Hetzner, explains how the German banking giant pulled off that Houdini-like feat.
Home price calculator. The median existing-home sales price hit a historic high in March, and that's got a lot of American families pondering whether it's time to put the place on the market. Here are some quick (and free) tips to measure your home's worth before calling in the appraiser.
Tesla's crypto profits, revisited. My colleague Shawn Tully has been all over TSLA's bitcoin profits. He has an update, based on the company's regulatory disclosure yesterday, which shows the gains from bitcoin were significantly bigger than first calculated. In recap, Tesla makes money selling permits. It makes money speculating in crypto. It makes little to no money selling cars.
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Market candy
Quote of the day
Do you take profits off the table? Let your winnings rise in hopes of even greater gains in the future? Try to pick the next big winner?
Ben Carlson of Ritholtz Wealth Management addresses the big question many an investor has been wondering: when should you cash out on your winning investments—whether it be crypto, tech stocks or the great-rotation winners? It's a worthwhile read.
