Welcome to 10 Things Before the Opening Bell.
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Let’s jump in.
1. Oil is at its highest in 3 years and stocks are falling. Fears around a global energy supply crunch and the hit to inflation are making for a nervous mood across the markets. Here’s what’s going on so far.
2. History shows the S&P 500 is on track to buck analysts’ gloomy forecasts. An upside surprise in the market is brewing as analysts have underestimated US corporate earnings despite strong seasonal trends, said DataTrek. See the numbers that suggest stocks will rise.
3. Warren Buffett has dumped banks, opting instead for Japanese and pharma stocks. In several surprising moves during the pandemic, Buffett exited his stakes in airlines and a slew of financial stocks. Veteran professor Erik Gordon analyzed Buffett’s strategy.
4. Earnings on deck: Micron Technology, Thor Industries, and Close Brothers Group, all reporting.
5. Investors: Buy the dip, says JPMorgan. Declining COVID-19 cases will drive economic growth and more gains for stocks, according to the bank. Read why the firm believes any dip should be viewed as a buying opportunity.
6. Morgan Stanley cuts Amazon’s price target. The investment bank still sees upside for Amazon’s stock price, though it anticipates the retailer facing hiring pressure and surging wage costs. Here’s how much Morgan Stanley thinks it could be worth in the future.
7. China’s central bank says it will protect consumers amid Evergrande fallout. As another payment deadline looms for the floundering Chinese property giant, the People’s Bank of China said it will “safeguard the legitimate rights of housing consumers.” Evergrande continues to teeter on the edge of insolvency.
8. The Fed presidents who faced calls to resign are now stepping down. Boston Fed president Eric Rosengren and Dallas Fed president Robert Kaplan are resigning. Both were criticized for big stock trades during the pandemic in firms like Apple and Tesla. Rosengren’s letter to Fed Chair Powell cited health issues as his reason for leaving.
9. Bitcoin steadies after China’s crypto ban shook markets. One fintech chief executive said retail investors don’t need to worry because worldwide enthusiasm for digital payments remains high. Here’s what 4 other experts say you need to know.
10. An ETF head explained how to capitalize on S&P 500 gains while minimizing risk. Johan Grahn manages over $US16 ($AU22) billion in assets. He thinks investors should remain vigilant following the Evergrande fiasco. Here’s what he recommends for capturing upside from equities while navigating volatility.
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