Overview of TOP weekly news

Australian regulator warns against trading forums

The Australian Securities Regulatory Authority has called for the investigation of stock trading internet forums and the possibility of “pump and dump” fraud on their platforms. Such a step means growing control of the investment subculture, which grew sharply during the pandemic.

The initiative of the Australian Securities and Exchange Commission (ASIC) by increasing oversight of local online retail chat rooms has risen since Reddit’s “WallStreetBets” chat room caused wild volatility in US stocks, especially GameStop.

According to the latest data, retail investors account for 15% of trades in the Australian market with 2 trillion Australian dollars, which is a 5% increase compared to pre-pandemic levels in the market.

The US economy is not out of the worst

Economist Alan Blinder of Princeton University told CNBC that, according to many projections, the US gross domestic product should grow by 6-7% this year, but some speak of an even higher growth rate. The Fed expects a growth rate of 6.5%, unemployment at the end of the year at 4.5% and inflation at 2.4%.*

Asked about the proposal to increase corporate taxes, he said that the US government is currently experiencing a high budget deficit, as a result of which the level of government debt is rising sharply. The United States cannot afford “one record fiscal package after another without also increasing fiscal revenues.”

It can be deduced from history that the correlation between the rate of taxation of capital gains, valuations and the return on the market is almost zero. It follows that the impact of tax increases on stock market growth should not have too negative consequences as originally expected.*

Tesla sells bitcoin

Elon Musk, CEO of the electric vehicle company Tesla, announced that the company had sold part of its assets in bitcoin after a billion-dollar purchase in early 2021.

In January 2021, Tesla bought $1.5 billion worth of bitcoin. The purchase of bitcoin by Tesla at that time caused a sharp rise in the price of the largest and oldest cryptocurrency according to market capitalization.

According to the report, Tesla sold $272 million worth of bitcoins in the first quarter of 2021. The price of bitcoin has appreciated since the acquisition, and the value of bitcoin held by Tesla may have risen to $2.72 billion, suggesting that Tesla may have sold a 10% stake in bitcoins. It is estimated that the sale of bitcoins helped make a profit of $101 million.

Huge loss of UBS

After an incident caused by Archegos Capital Management, UBS calculated a final loss of $774 million. The largest Swiss company reported a significantly higher loss from the closing of the US fund’s trades than analysts had originally expected.

 

Performance of UBS’s shares (Source of the graph: Tradingview) [1]  

The Nasdaq reached February highs

The Nasdaq Composite broke the first record on Monday since February, as investors looked forward to a busy week of corporate earnings reports, including from some of the largest technology companies. The technology index rose by 121.97 points and closed at 14,138.78 points, which is already the 13th closing at new highs in 2021.

Performance of index Nasdaq Composite (Source of the graph: Tradingview) [2]

Watch this week:

Thursday, April 29, 2021

Germany will publish unemployment developments in April. The expectation is an unchanged unemployment rate of 6%. *

Friday, April 30, 2021

The eurozone will publish the development of CPI inflation in April. Analysts expect 1.6% year-on-year growth. *

Canada will announce GDP developments in February. Expectation is 0.5% month-on-month growth. *

Source of the text: Investing, Zerohedge, Financial Times, Reuters, Tradingview

 

[1,2] Past performance is no guarantee of future results

*     Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or based on the current economic environment which is subject to change. Such statements are not guaranteeing future performance. They involve risks and other uncertainties which are difficult to predict. Results could differ materially from those expressed or implied in any forward-looking statements.

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