What's happening in the markets - Thursday 4 February 2021

Thursday, February 04, 2021 - 20:58
Point Trader Group
What's happening in the markets - Thursday 4 February 2021

US stocks are rising again as the downturn continues and the yield curve continues to slide. There is no major driver for the markets today. Treasury yields remain the same, and earnings from Merck, Unilever and Yum are nothing to be excited about.

 

Dogecoin rises after Elon Musk's tweet

Elon Musk's break on Twitter has ended and his love for Dogecoin has clearly not diminished. Elon Musk deleted bitcoin from his autobiography and tweeted: "Dogecoin is people's currency"

Dogecoin surged higher and its rise caused quite a stir across all major cryptocurrencies. Bitcoin initially slumped after Elon Musk removed bitcoin from his Twitter résumé, but it still appeared to be ready for another round towards the $ 40,000 level.

Apple car?

Apple appears to be ready to take another stab at making a car. The partnership between the tech giant and Hyundai-Kia is close, but that doesn't mean another automaker cannot join the mix. An Apple-branded autonomous electric vehicle with Hyundai Kia could go into production in 2024.

Apple’s automotive effort began in 2014 and was abandoned in 2016. Engaging with Tesla will be a difficult task and to be successful Apple will need to design a better battery.

U.S. dollar

Since the Georgia Senate run-offs gave President Biden a "big boost" in January, the dollar has been in turmoil against the euro. At the end of last year, the dollar approached its lowest level in a decade. After touching roughly 1.2350 in January, the Euro fell below the 1.20 level. The macroeconomic outlook for the Eurozone has been hit hard by a disappointing vaccine rollout and this pessimistic assessment could lead to more pain for the EUR.

Ultimately, the dollar will lose its crown and unprecedented financial and monetary efforts will affect the currency. The EUR / USD could easily test the 1.19 level this week.

Bank of England

The British pound rallied after the Bank of England eased fears that they were close to considering negative interest rates. Hope for the best and preparing for the worst is what the Bank of England is telling banks. Preparing for negative rates was an effective next step. The bank is studying the possibility of developing a multi-level system. GDP growth forecast has been reduced from 7.5% to 5.0%.

The UK economy is in transition, and the successful introduction of the vaccine should indicate the second half of the year.

Oil

Crude oil continues to rally on the back of strong momentum from lower stocks and the development of a coronavirus vaccine. The calm has been on the energy front so far, allowing energy traders to focus on improved supply and demand fundamentals. Brent crude faces a strong price barrier at the $ 60 level.

gold

Gold is falling as the dollar's recovery continues and demand for safe-haven currencies falls. Gold is trying to consolidate, but it may continue its decline below $ 1800, all the way to 1766, as it may find itself in the danger zone.

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