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Bonds, stocks, & bitcoin battered (42,000) as “rage-hike” fears grow. The Wall Street markets were smashed today in volatile trading that ended with the S&P 500 closing down 1.8%. Starting this holiday-shortened trading week saw rising bond yields, persisting rate pressures, and a big earnings miss by Goldman Sachs.

Today saw both bonds and stocks battered, creating the biggest daily aggregate loss (10Y TSY Px plus S&P 500) since March 2021. Oil prices are also trading at their highest level in seven years (86.19), but the move could be short-lived according to Exxon CEO Darren Woods is confident they will trend lower.

As usual, we have included below the headlines and news summaries moving the markets today.

Even though the markets were closed today, the usual financial headlines and news summaries follow.

Major economic releases today.

• Over the past year, import prices increased 10.4 percent and export prices advanced 14.7 percent.
• Advance estimates of U.S. retail and food services sales for December 2021 … were $626.8 billion, a decrease of 1.9 percent (±0.5 percent) from the previous month, but 16.9 percent (±0.9 percent) above December 2020.
• Industrial production declined 0.1 percent in December. Losses of 0.3 percent for manufacturing and 1.5 percent for utilities were mostly offset by a gain of 2.0 percent for mining. 

The markets were mixed today with the DOW off 0.6%, NASDAQ up 0.6%, and the S&P up 0.1%. Bitcoin inched up to $43,150. WTI crude climbed to $83.90. Gold little changed at $1,824.

As usual, we have included below the headlines and news summaries moving the markets today.

Markets today seem to be spooked by the continuing hawkish comments from the Federal Reserve members regarding rate hikes which normally negatively affect stock prices. During her confirmation hearing today, Fed Governor Lael Brainard stated:

The committee has projected several hikes over the course of the year. We will be in a position to do that, I think, as soon as asset purchases are terminated. And we will simply have to see what the data requires over the course of the year.

The markets closed lower today with the DOW off 0.5%, NASDAQ off 2.5%, and the S&P down 1.4%. Bitcoin declined to $42,760. WTI crude was down to $81.47. Gold was marginally up at $1,824.

As usual, we have included below the headlines and news summaries moving the markets today.

The market marginally improved today even though the latest inflation data from the Consumer Price Index shows year-over-year inflation has increased to 7% – the fastest pace since 1982. From the BLS:

In December, the Consumer Price Index for All Urban Consumers rose 0.5 percent, seasonally adjusted, and rose 7.0 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.6 percent in December (SA); up 5.5 percent over the year (NSA).

The DOW was up 0.1%, NASDAQ up 0.2%, and the S&P up 0.3%. Bitcoin improved to $43,670. WTI crude now up to $82.61. Gold also up at $1,816. The markets have been little affected by the record Omicron cases.

As usual, we have included below the headlines and news summaries moving the markets today.

However, all is not to be celebrated so soon as the markets reached a resistance of the Jan 6 and 7 sessions. Yesterday’s remarkable market reversal is being explained away by analysts, but tomorrow is going to be telling.

Powell’s testimony easing fears of an ultra-hawkish Fed may not be enough to ease investors’ fears.

Empty grocery shelves return as sick employees, supply chain delays collide. Retailers detail staffing shortages as omicron rages, but some investors see it as a short-term hit.

China Boosts Imports Of Cheap Oil From Sanctioned Iran And Venezuela. Oil Prices Jump Over 3% Ahead Of Inventory Data

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Renewables stocks are plunging, and Libyas crude exports slump as bad weather shuts four oil ports. In addition, U.S. emissions jumped in 2021 as coal power generation surged. Although stocks rebound off the worst levels of the day, NASDAQ is still down about 1% as it entered correction territory amid a broader market retreat.

CNBC ProNasdaq’s NASDAQ chart sends a warning signal, but analysts see an opportunity in the breakdown. Nasdaq slumps into correction territory after a painful start to 2022. Bitcoin briefly tumbles below $40,000 to the lowest since September as stocks slide, tech shares renew declines as Treasury yields advance.

Lululemon shares fall after the retailer sees fourth-quarter earnings, sales hurt due to omicron. Jamie Dimon one-ups Goldman: Says he would be “surprised” with just four rate-hikes. Buy the dip, says JPMorgan. ‘Markets can handle higher yields.’

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Wall Street mostly stagnate, choppy trading sideways after the Wednesday selloff. DOW traded in positive territory for most of the day as other U.S. stock indexes declined after Friday’s jobs report. Investors appear to be starting the year with an aversion to long-duration stocks and instead are leaning into Value stocks with closer ties to economic recovery.

Geopolitics And Production Problems Push Oil Prices Higher as U.S. Rig Count rise. The number of active drilling rigs in the United States rose by two this week, keeping the total rig count at 588. As a result, oil prices remain strong despite the fresh wave of Covid-19 cases brought by the new variant of the coronavirus amid several oil disruptions around the globe, including in Libya, Ecuador, and Kazahkstan.

Virgin Orbit stock pops more than 20% as Branson’s company shows off its rocket in Times Square. In other news, Bed Bath & Beyond is closing more stores in 2022. Liquidation sales have kicked off at 37 Bed Bath & Beyond locations in the United States, and the stores expect to be padlocked by the end of February.

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Wall Street was mostly stagnate, sideways choppy trading after the Wednesday selloff. Trading was curbing losses from yesterday as the central bank considers raising interest rates sooner than expected, spooking market investors. The three major indexes remained in the green until late in the session until more investor decided to jump a sinking ship. According to quants at Morgan Stanley, yesterday’s market rout was worse than every selloff in the past five years, including the March 2020 crash.

BTFDers bought the low after the market opened, but to no avail. The DOW closed down 171 points, the NASDAQ down 0.1%, and the S&P 500 slipped down 0.1%. WTI crude moved up moderately, settling at 79. Gold is down fractionally at 1789, with silver at 22.15.

Sundial Research notes that a near-record number of tech stocks have plunged by some 50%, a number that was surpassed only by the March 2021 crash and the global financial crisis.

Bitcoin and other cryptocurrencies slide as global stocks fall after hawkish Fed minutes. Bitcoin is at 43500, and Dogecoin is trading around $0.1610.

Despite persistent supply chain snags, the automobile sector comfortably outperformed the broader market over the past year. Luxury carmaker Bentley reports a second consecutive year of record sales of 14,659 vehicles last year, a 31% increase as other automakers struggle.

Short-Term Interest-Rates (STIRs) continued their hawkish push higher today after The Fed’s Jim Bullard noted that FOMC could start raising policy rates as soon as March, and shrinking the balance sheet will be the next policy step.

Traders and investors were waiting to read the minutes of the December 14-15 FOMC meeting – and were surprised by the following:

In light of elevated inflation pressures and the strengthening labor market, participants judged that the increase in policy accommodation provided by the ongoing pace of net asset purchases was no longer necessary. They remarked that a quicker conclusion of net asset purchases would better position the Committee to set policy to address the full range of plausible economic outcomes. Participants judged that it would be appropriate to double the pace of the ongoing reduction in net asset purchases. Such a change would result in reducing the monthly pace of net purchases of Treasury securities by $20 billion and of agency MBS by $10 billion starting in January. Participants also expected that economic conditions would evolve in a manner such that similar reductions in the pace of net asset purchases would be appropriate each subsequent month, resulting in an end to net asset purchases in mid-March, a few months sooner than participants had anticipated at the November FOMC meeting.

This threw a wrench into the market outlook with the DOW sliding 1.1%, NASDAQ off 3.3% and the S&P down 1.9%. And Bitcoin fell to $44,214.

As usual, we have included below the headlines and news summaries moving the markets today.