A popular stock-marketindicator ashes red asDow soars to recordsFriday
AMC | Numbers you need to have in mind.
Below are the data sources, inputs, and calculations used to determine the intrinsic value for AMC Entertainment Holdings. An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated. Discounted Cash Flow Calculation for NYSE: AMC using 2 Stage Free Cash Flow to Equity The calculations below outline how an intrinsic value for AMC Entertainment Holdings is arrived at by discounting future cash flows to their present value using the 2 stage method. We use analyst's estimates of cash flows going forward 10 years for the 1st stage, the 2nd stage assumes the company grows at a stable rate into perpetuity. Read: Is AMC a good investment for the future?
Afghanistan’s Fall And Its Possible Impact On The Global Financial Markets
There is no factor that negatively affects the financial markets like the uncertainty of investors. Following the recent unrest and the toppling of the president, the investor confidence in Afghanistan could drop to an all-time low. Millions are looking to flee the country, and this implies that virtually all aspects of the economy are not working. If people are worried about leaving the country, they won’t settle down to do their jobs, and this will negatively affect the economy. With economic activities currently down, it is only right that the financial markets are down also. Furthermore, some foreign countries such as Germany are starting to pull their people out of the country. Investors, but foreign and local, will have little interest in the Afghan financial markets at the moment, and this would have both short and medium-term effects on the economy. If the Taliban remains in power, many investors will pull out of Afghanistan as they would not be sure of the working conditions under the new Islamic leadership. On the global stage, the financial markets would also be affected. So far, the effects of the unrest in Afghanistan are already visible in other parts of the world. Financial market indices are down, with investors keenly watching to see how the world leaders would react to the situation. The FTSE 100 dropped by 0.90% today, while the STOXX Europe 600 also lost 0.50% of its value. The Dow Jones Industrial Average (DIJA) and the S&P 500 are also down by 0.065% and 0.23% so far today. The NASDAQ composite is another major index that is currently trading in the red zone, and it is down by 0.74% at the time of this report. S&P 500 chart. Source: TradingView This means that most of the major global financial market indices are trading in the red zone over the past 24 hours. The performance paints a clear picture of the current state of the financial markets and what investors are feeling. Joe Biden made an address regarding the situation in Afghanistan later yesterday. His speech could play a huge role in how the financial markets would perform over the next few days. This is because most of the other major world leaders would be looking to the United States to determine the next line of action. The next few hours and days would be interesting as the progress in Afghanistan could shape the performance of the financial markets globally. This article was originally posted on FX Empire
Assessing the Ownership of Alibaba Group (NYSE:BABA) in Face of Regulatory Pressures
Alibaba Group Holding Limited's ( NYSE: BABA ) just made fresh new lows, falling to levels not seen in 2 years. The stock is now dipping to a price-to-earnings ratio below 20, which is hard to imagine for an internet retailer in 2020. We will take a look at the shareholder structure and see what it can tell us about the current state of the company No Breathing Space for Chinese Stocks Chinese regulators kept the pressure through this week. After issuing a fresh draft about the unfair competition on the internet, they approved a strict data privacy law. The Standing Committee of the National People's Congress passed the Personal Information Protection Law – aimed at online fraud, information theft, and, most importantly, data collection by domestic tech companies. Meanwhile, SEC Chairman Gary Gensler issued a warning about Chinese companies quoting their willingness to bypass their domestic laws by operating through shell companies in other countries. It is no secret that there is a significant flow of capital in the gray area between China and havens like the Cayman Islands. On the more positive side, Alibaba is moving toward the NFT-mania, opening up the Blockchain Digital Copyright and Asset-Trade. Trading will be done through a blockchain-backed by the Sichuan provincial government. Alibaba stock is slowly moving into the value territory. Ownership Outlook Alibaba Group Holding is a pretty big company. It has a market capitalization of US$435b. Normally institutions would own a significant portion of a company this size. Let's take a closer look to see what the different types of shareholders can tell us about Alibaba Group Holding. Institutional Ownership is Considerable Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing. As you can see, institutional investors have a fair amount of stake in Alibaba Group Holding.This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does.If multiple institutions change their view on a stock simultaneously, you could see the share price drop fast. It's, therefore, worth looking at Alibaba Group Holding's earnings history below. Of course, the future is what really matters. SoftBank Group Corp. is currently the company's largest shareholder, with 25% of shares outstanding. In comparison, the second and third largest shareholders hold about 2.6% and 2.5% of the stock. Our research suggests that the top 25 shareholders collectively control less than half of the company's shares, meaning that the shares are widely disseminated, and there is no dominant shareholder. While studying institutional ownership data for a company makes sense, it also makes sense to study analyst sentiments to know which way the wind is blowing.There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future. Insider Ownership The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least.Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are founders or CEOs. Insider ownership is positive when it signals leadership is thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances. At the moment, Insiders own US$15b worth of shares (at current prices). It is good to see this level of investment. You can check here to see if those insiders have been buying recently. General Public Ownership The general public holds a 30% stake in Alibaba Group Holding. While this size of ownership may not be enough to sway a policy decision in their favor, they can still make a collective impact on company policies. Public Company Ownership We can see that public companies hold 25% of the Alibaba Group Holding shares on issue. We can't be certain, but this may be a strategic stake. The businesses may be similar or work together. Next Steps: While it is well worth considering the different groups that own a company, other factors are even more important. Consider, for instance, the ever-present specter of investment risk. We've identified 2 warning signs with Alibaba Group Holding, and understanding them should be part of your investment process. Like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full-year annual report figures. Simply Wall St analyst Stjepan Kalinic and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Berkshire Hathaway’s earnings fall 66%
Unrealized investment gains at Warren Buffett’s conglomerate declined in the third quarter Warren Buffett (L), CEO of Berkshire Hathaway, and vice chairman Charlie Munger
Johannes Eisele/AFP/Getty Images Warren Buffett’s Berkshire Hathaway Inc. reported lower third-quarter profits after unrealized investment gains declined.
Berkshire $BRK.A $BRK.B said Saturday that its third-quarter net earnings fell to $10.34 billion, or $6,882 per Class A share equivalent, from $30.14 billion, or $18,994 a share, in the same period a year earlier.
Better.com CEO Vishal Garg steps back for "Time Off" as employees detail how he ‘led by fear’
Looks like Better.com CEO Vishal Garg’s behavior is catching up to him. This morning, employees were notified via email by the Better board of directors that Garg would be taking time off effective immediately after the “very regrettable events over the last week.” The move came, according to an employee who wished not to be named, after the digital mortgage company hired a crisis firm earlier this week. For those of us following the drama over the past week — over the past year, really — it was not a surprise. More details around the executive’s behavior have emerged, including in emails that surfaced this week in which Garg berated his own investors, Vice reported. He already had a reputation for using abusive language in emails to employees, but the treatment toward his investors was yet another shock. In the email to employees sent this morning, the board said that during the interim period, CFO Kevin Ryan would be assuming the responsibilities of CEO. It also acknowledged that it had engaged “an independent 3rd party firm to do a leadership and cultural assessment,” the results of which would be “taken into account to build a long-term sustainable and positive culture at Better.” But the decision may be too little, too late. TechCrunch has spoken with multiple current and former employees who remain skeptical that a toxic culture can be reversed that quickly. Those same employees shared that the CEO’s so-called “apology” — which came after the resignations of the company’s heads of PR, marketing and communications — was widely viewed as insincere damage control. One employee said she had been thinking of resigning even before the recent events, but they finally pushed her over the edge. Garg “leads by fear,” she said, preferring not to be named. “Nothing is ever good enough. He would threaten employees to work harder, faster and not be lazy, but there was never clarity on what the consequences might be.” The pressure seemingly intensified over the past few months as the company took a hit when the number of refinancings declined. “It wasn’t a shock that the market had turned on us,” the employee said. “But the model’s predictions were that it wouldn’t happen this quickly. There just seemed to be more underlying anxiety after the SoftBank investment over the summer and with the SPAC approaching. But they could have been more transparent and just admit they overhired people last year.” The company laid off 9% of its staff last week, one day after receiving a $750 million cash infusion as part of an amended SPAC agreement. While it was not the first (or likely the last) company to lay off workers via Zoom in this pandemic era, the way it was handled seemed to offend even casual observers. Another sign of panic was that the company, after declaring itself remote-first, was suddenly asking people to return in-person. This was confusing to many, including those who had already moved and bought houses in other cities. In mid-November, HousingWire reported on preliminary results published by Better’s SPAC partner, Aurora Acquisition Corp., revealing that the digital lender expected a net loss between $85 million and $100 million in the third quarter. And the forecast looked even worse for the fourth quarter, according to an S-4 filing with the U.S. Securities and Exchange Commission. According to HousingWire: “The filing noted that the fluctuations in interest rates – which affect refis more than purchase business – and a recent reorganization of Better’s sales and operations teams has put pressure on the company’s net income and will continue to do so for the foreseeable next quarter, as the company attempts to find footing in a purchase market.” This is after a year in which Garg received a $25 million cash bonus: “In 2020, after previously requesting an equity-based award, our CEO was paid a one-time discretionary bonus of $25.0 million as determined by the Board based on his 2020 performance,” the S4 filing said. Meanwhile, one former employee said her colleagues that stayed on were being asked to take pay cuts and not receiving bonuses. She added that during the pandemic, despite being remote, customer-facing employees were forced to clock in breaks at exactly 15 minutes and 30 minutes. “If we went over by even one minute, we’d be talked down to by managers,” she told TechCrunch. “Some team members even had talkings-to by senior managers on this matter.” The same employee also scoffed at the notion that Better lived up to its image of being a fintech where opportunities to grow were plentiful. “Better advertised itself as a powerful fintech startup where all who wanted to grow within the ecosystem, could. This was untrue,” she said. “There were virtually no opportunities for growth, raise, department collaboration, etc. Managers were sales machines and regardless of career paths, there was no room to succeed. … At Better, we were essentially taught to push customers/callers for rate locks, regardless of their intention.”
Better.com CEO apologizes to current employees for 'blundering' of mass layoffs; SPAC delayed
Better.com CEO Vishal Garg apparently realizes he’s done wrong. (As if the barrage of negative publicity wasn’t enough evidence of that.) Today, a letter to current employees was leaked on Blind by a verified Better employee. In the letter, Garg apologized for the way he (mis)handled the layoff news last week, writing: “I failed to show the appropriate amount of respect and appreciation for the individuals who were affected and for their contributions to Better. I own the decision to do the layoffs, but in communicating it I blundered the execution. In doing so, I embarrassed you.” Some might argue that he also embarrassed himself. Among the affected employees was the company's diversity & inclusion team, according to multiple sources. Earlier today, sources familiar with internal happenings within the company told TechCrunch the company’s VP of communications, Patrick Lenihan; head of public relations, Tanya Gillogley; and head of marketing, Melanie Hahn, have all submitted their resignations. Insider also reported that news earlier today. The fallout from the way CEO and co-founder Vishal Garg handled the layoffs of about 900 people, as first reported by TechCrunch, has been widespread, including criticisms of it being handled over Zoom, to charges of insincerity on Garg’s part. Memes about the video have even landed on TikTok as people all over the world trashed Garg’s actions. The move last week came after the digital mortgage lender announced it had received a cash infusion of about $750 million as an amendment of its SPAC agreement with blank check company Aurora Acquisition Corp., and SoftBank, and then promptly laid off about 9% of its 10,000 workforce. The company is expected to go public at a $6.9 billion valuation. Today, Bloomberg reported that the company is now (unsurprisingly) pushing back its SPAC, which was originally expected to close in the fourth quarter of this year. Garg also confirmed to Fortune this week that the company accused “at least 250″ terminated staffers of stealing from the company and customers by working just two hours a day. Not long after Garg announced the layoffs, he addressed the company in a livestreamed town hall. He laid out a vision of what he called “Better 2.0,” with a “leaner, meaner, hungrier workforce,” according to a leaked recording of the meeting shared with Insider. TechCrunch has reached out to Better.com for comment but has not yet heard back at the time of writing. The employees said to have resigned also have not responded to requests for comment. Better.com is not the only SoftBank-backed proptech that has seen top executives leave in advance of its public debut. In 2019, Insider also reported more than a dozen of WeWork’s top officials had left the company amid reports of internal complaints and uncertainty surrounding its IPO plans. The question on all of our minds at this point is will investors and board members tolerate this sort of behavior from Garg, or will he be forced out, Adam Neumann-style? Garg’s reputation as a not very nice person goes back to last year, when Forbes revealed the contents of an email to employees from Garg: “HELLO — WAKE UP BETTER TEAM. You are TOO DAMN SLOW. You are a bunch of DUMB DOLPHINS and…DUMB DOLPHINS get caught in nets and eaten by sharks. SO STOP IT. STOP IT. STOP IT RIGHT NOW. YOU ARE EMBARRASSING ME.” That same Forbes article revealed that Garg was the subject of a number of lawsuits from the likes of PIMCO and Goldman Sachs for things like “improper and even fraudulent activity at two prior business ventures, and of misappropriating “tens of millions of dollars.” The recent dip in refinancings is believed to be a factor in Better.com’s decision to lay off some of its employees. In April 2020, Better.com said it was “hiring aggressively” as more people were seeking to refinance their homes in the face of historically low mortgage rates. At that time, I had reported for Crunchbase News that an internal memo to employees from Garg revealed that the mortgage lending startup was looking to hire about 1,000 people in 2020 as a whole “as more and more homeowners come online for their needs.”
Better.com IPO: What You Need To Know
Mortgage rates are at rock bottom, housing demand is sky high and millions of Americans are rethinking where to live as businesses embrace remote work. What better time for Better.com to go public? This five-year-old online mortgage startup has enjoyed tremendous growth in recent years thanks to these trends, plus its canny ability to streamline the famously laborious and expensive home buying process. Better.com has pushed fees and commissions down to zero, which has helped it do billions of dollars in mortgage originations, refinancings and title and property insurance sales. Yet uncertainty remains about Better.com’s business. Bigger players in the mortgage space like Rocket Mortgage have bumbled along despite impressive technology and intense home buying interest—and Better.com’s founders come with their own baggage, including a recent controversy when Better.com’s chief executive fired 9% of his workforce via Zoom. The only question then is whether you should see Better.com as a hidden gem, or more of a fixer-upper? The Case For Better.com’s IPO As with any hot new company, there’s an impressive growth story with Better.com that investors hope they can build upon. In May 2021, the Softbanked-backed Better.com disclosed that it had entered a deal to go public via a merger with special purpose acquisition company (SPAC) Aurora Acquisition. The companies are aiming to close the deal sometime before the end of the year. Better.com reported that its loan value had climbed to more than $24 billion in 2020, an increase of 490% year over year, while its title insurance business had grown by 855% year over year in 2020, its homeowners insurance was up 300% and real estate transactions were up 471%. This impressive growth, according to the company, was a product of a labor force that costs about half that of its competitors, and that it completes more than twice as many loans per month than competitors. Better.com also has the backing of major financial institutions, like SoftBank and Ally. Clearly, Better.com’s plan to incentivize more regular folks to take out a mortgage online is working well. Getting a mortgage is famously difficult, replete with a seemingly never-ending array of fees. Better.com’s website, on the other hand, is easy to use, its brokers don’t charge commissions or loan origination fees, and prospective buyers can get pre-approved in a matter of minutes. This kind of home buying experience is sure to connect with younger, digital native Americans between the ages of 22 and 40. This is the biggest of cohort of home buyers, making up 37% of the market, according to the National Association of Realtors. As noted above, times couldn’t be stronger for mortgage companies. In October 2016, the interest on a 30-year fixed rate mortgage was 3.47%, according to Freddie Mac. That had dropped to 2.74% by the beginning of 2021. It’s now around 3.07%. This has led to an avalanche of mortgage refinancing, as existing owners looked to take advantage of lower rates. It’s also piqued the interest of potential buyers looking to borrow less to buy homes. Median home sale prices are currently around $410,000, according to the Department of Housing and Urban Development, up nearly $100,000 from five years ago. The Case Against the Better.com IPO As anyone who lived through the housing market meltdown of 2005 to 2007 can attest, real estate ain’t always so rosy. While Better.com has been able to make its bones in a low-rate environment, what happens when mortgage prices return to historical norms? How will that impact its refi business, for instance? And even before then, the current housing market has issues. A shortage of construction workers combined with supply chain woes have delayed new home construction. That’s driven up demand for existing housing, but there are only so many of that to go around. At some point, housing prices may become too burdensome for families to bear, no matter how low mortgage rates are, which may crush demand. Then there’s the curious case of Rocket Mortgage (RKT). This Detroit-based online mortgage company is the nation’s leading originator by volume, and Rocket is well known as a digital disruptor. After the company’s initial public offering (IPO) in 2020, insatiable demand for its shares never appeared. RKT is down more than 13% in 2021 to date, compared to a 25% gain in the S&P 500. Even still, analysts appear bullish on Rocket’s long-term advantages. “While Rocket’s revenue and earnings will likely remain volatile, a symptom of the cyclical nature of the mortgage industry, the company’s strong competitive position and trends in consumer behavior will provide it with long-term secular growth,” noted Morningstar equity analyst Michael Miller. Should You Invest in Better.com? The mortgage industry is incredibly competitive, which means Better.com is facing many entrenched stalwarts with their own powerful technologies to increase efficiency and reduce costs. Meanwhile, it doesn’t have the lead-generating capabilities of a Wells Fargo or JPMorgan Chase, who can convince millions of existing customers to get a mortgage through them. What Better.com has is a powerful growth story and a vision of an easier mortgage application process for the future. Its executives also bring controversy that could upend that narrative. In 2020, Forbes detailed how Better’s chief executive Vishal Garg created a reportedly unhealthy work environment and drew lawsuits from former business partners, some of which allege fraud. The more recent brouhaha over Garg’s mass layoffs adds further fuel to the narrative that Better.com simply isn’t governed effective. Given Rocket Mortgage’s dismal performance, the uncertainty in the housing market and the inherently risky proposition of buying shares of any individual company, you should consider waiting until the dust settles before diving into shares of Better.com.
China Readies Strict Data Privacy Laws. What It Means For Investors.
China dealt its big Internet companies yet another hit on Tuesday, unveiling details on measures to limit unfair competition and plans for what could be the world’s strictest data privacy laws . Shares of China’s technology giants have slumped as Beijing has unleashed a wave of regulatory measures since last fall that look to reset rules for these Internet behemoths. The KraneShares CSI China Internet exchange-traded fund (KWEB) fell 1.4% on Tuesday and is down nearly 41% so far this year. That’ s a steep decline but even more stark in contrast to U.S. Internet stocks, with the First Trust Dow Jones Internet ETF (FDN) up 13% year-to-date. The latest draft of regulations call for Internet companies to not implement or assist in unfair competition, targeting behaviors like controlling user traffic and using algorithms to influence users’ choices and blocking competitors’ products. Also targeted: Fabricating or spreading misleading information that damages rivals’ reputations and marketing practices that incentivize fake reviews on products. Officials are also working on privacy laws that would require companies and individuals handling Chinese citizens’ data to minimize data collection and seek prior consent.
If that sounds a lot like the sources for Internet companies’ supercharged growth, that’s partly the concern for investors, who are reassessing expectations.
“For China’s technology firms, the era of free data collection and usage in China – ‘freely’ —with no consent, ‘free of responsibilities’—with no liability, and ‘for free’ is over,” says Winston Ma, former head of North America at the China Investment Corp., China’s sovereign wealth fund, and an author of The Digital War – How China’s Tech Power Shapes the Future of AI, Blockchain and Cyberspace. “Companies like Alibaba, Tencent and ByteDance will have to rethink their business models and how they collect data.”
Officials also said they plan to implement regulations aimed at protecting critical infrastructure information operators Sept. 1—the latest indication that the regulatory push isn’t over.
Investors expect more regulation ahead. “It’s how China works. The Central committee makes a decision and carries it out. That means there will be continual pressure for regulation to create a more level playing field and [regulators] looking for anomalies that are not good for the majority of the people,” veteran emerging markets investor Mark Mobius told Barron’s. Mobius, who now heads Mobius Capital Partners, has been underweight China versus the benchmark, valuations, and regulatory risk, preferring places like India instead.
Data is a top concern for Chinese policymakers—but also others globally. “If you want to name one huge global risk it’s the cloud and interconnectivity,” Mobius says.
Mobius still sees opportunity in China, with some of the regulatory measures creating a better longer-term outlook in what he says is a huge and growing market that just can’t be ignored though his focus is outside of the behemoths and more at smaller companies that can be tomorrow’s giants.
“What is leadership’s objective? Their objective is to become greater than the US. How do they do that? Deng Xiaoping reached the conclusion that the only way to be greater is to copy the US and create a market economy. They are moving toward a market economy with a level playing field with a certain degree of regulation where they want enterprises growing,” he says.
That’s not to say there’s no risk: “Of course, at the end of the day, their Achilles’ heel is the one-party state,” Mobius adds. “It hasn’t hurt China up to now because it allowed the market economy to grow at a rapid pace in a freeway. The degree to which they do not allow this to happen is where they would have a problem.”
And that’s the risk that is making some wary. In a webinar with clients, TS Lombard strategists Larry Brainard and Andrea Cicione described the recent moves as an inflection point as Xi Jinping tries to strengthen the party, tackle inequality, and grapples with tensions with the U.S. and efforts to build up China’s domestic hardware ecosystem.
That approach will have implications on long-term valuations, with the strategists concerned what they see as an erratic crackdown could send risk-takers and innovators to the sidelines. For investors, that makes a passive approach even riskier, with the strategists saying stock-picking was the only way to invest in China at the moment because of the lack of uncertainty created by different regulators within China unleashing measures, the strategists added. This article was originally shared by Barron's
Coke | Director Herbert Allen has left the company
On the 18th of August, Herbert Allen's tenure as Director ended. As of June 2021, Herbert still personally held 12.10m shares (US$655m worth at the time). A total of 3 executives have left over the last 12 months. The current median tenure of the management team is 2.42 years. According to analysts, the Coca-Cola Company (NYSE:KO) stock is 24.0% under its fair value as of today, despite the departure of director Herber Allen Source: Simply Wall St. Check out this analysis related to Coca-cola stock:
Dow Hits Record as Bulls Feast on Stimulus Hopes
By Yasin Ebrahim Investing.com – The Dow climbed to an intraday record Friday, as traders bet a wobble in the jobs market will force U.S. lawmakers to roll out a fiscal relief package sooner rather than later. The rose 0.68%, or 202 points to a record 30,172. The was up 0.64%, while the gained 0.56%. All three indexes hit intraday record highs. The U.S. economy created just 240,000 jobs in December, missing forecast for 474,000 new jobs. The unemployment rate fell to 6.7% from 6.9%. "Today's data underscore the urgent need for additional policy support. Fiscal authorities are clearly better equipped to offer relief, and recent developments are encouraging. If Congress fails to deliver next week, we would expect the Fed to step in. Either way, help is on the way," Jefferies (NYSE:) said in a note. House Speaker Nancy Pelosi said Friday she held talks with Senate Majority Mitch McConnell about adding the new bipartisan $908 billion coronavirus relief legislation to a government funding omnibus, which must pass within the next week. A day earlier, McConnell said a compromise was “within reach” on a bipartisan Covid-19 relief package. Value stocks – those linked to the progress of the economy – were in demand as financials, industrials and energy climbed, with the latter pushed higher by rising oil prices. Energy jumped more than 3% after OPEC and Russia agreed to raise production by 500,000 barrels per day from January, sending oil prices up more than 1% as investors bet on further tapering of production cuts ahead. “This is a slower ramp-up than the previously planned 1.9 mb/d January increase … OPEC+ was able to clear the important hurdle of exiting its current cuts in a coordinated way, strongly reducing the tail risk of an OPEC+ taper tantrum,” Goldman Sachs (NYSE:) said. Occidental Petroleum (NYSE:), EOG Resources (NYSE:), and Diamondback Energy Inc (NASDAQ:) were among the biggest gainers, with the latter up 12%. Other value sectors of the market that are also sensitive to the economy like financials, industrials, and materials also racked up gains, pushing the broader market higher. In tech, DocuSign (NASDAQ:) and Cloudera (NYSE:) climbed sharply, up 5% and 8% respectively, on better-than-expected quarterly reports. In other news, Marvell Technology (NASDAQ:) warning of “industry-wide supply constraints,” offset better-than-expected quarterly results. Its shares fell more than 4%. “These supply challenges are currently limiting our ability to fully satisfy the increase in demand for some of our networking products,” the company said
Fed: Crypto is "95% fraud, hype, noise, and confusion"
Minneapolis Federal Reserve President Neel Kashkari on Tuesday had some harsh words for the nascent crypto asset market. The central banker said he doesn’t see any use case for bitcoin BTCUSD, 0.08%, the world’s No. 1 crypto, and referred to the broader digital-asset sector as one that is largely tied to fraud and hype. “Cryptocurrency is 95% fraud, hype, noise, and confusion,” Kashkari said, speaking at the Pacific Northwest Economic Regional Annual Summit in Big Sky, Mont. Bitcoin prices were at $44,993, down 2.4% on CoinDesk on Tuesday. Meanwhile, Ether ETHUSD, -1.33% on the Ethereum blockchain was changing hands at $3,069, off 3%, while meme coin dogecoin DOGEUSD, -4.35% was trading at around 30 cents, down 5.1%. Crypto has gained traction among institutional investors in 2021 but is still viewed as a speculative and highly risky trade compared with traditional markets. Kashkari also offered some of his views on monetary policy plans, noting that he still sees a “a lot of slack” in the U.S. labor market, and suggesting that he might need a couple of more strong jobs reports before he is inclined to support a push to scale back the central bank’s monthly purchases of $120 billion in Treasurys and mortgage-backed securities. The Minneapolis Fed president’s comments come amid growing talk about the timing of pulling back the Fed’s COVID-era accommodations and eventually raising interest rates as the economy attempts to recover from the pandemic. On Tuesday, the Dow Jones Industrial Average DJIA, -0.79% and the S&P 500 index SPX, -0.71% snapped five-session win streaks, with some blaming the day’s declines at least partly on growing concerns about a rollback of easy-money policies. For his part, Kashkari said that it would be reasonable to start reducing bond-buying by the end of 2021 if the job market cooperates. In July, the U.S. created a robust 943,000 jobs, in what some viewed as a sign that the economic recovery was gaining some steam, despite the latest assault from the delta variant of COVID-19.