Why did US stocks fall sharply? Analysis of the market trend next week, institutions will not easily let go of MAMATA

Black Friday is not only a discount on commodities, but also a discount on US stocks! The loan interest rate is also discounted!

If it weren’t for Friday’s Thanksgiving to close a few hours earlier, it is estimated that the market could fall even more. Now this long weekend holiday is a chance for traders and investors to take a breather and calm down to think about whether the market is overreacting and whether Wall Street is overly nervous? Or should the bears take this opportunity to harvest a wave of leeks? And should retail investors lighten up their positions or is it an opportunity to buy bottoms?

One of the important reasons for the panic caused by the new mutant virus is its high transmission.

B.1.1.529 , the WHO named it Omicron , which is the most mutated new coronavirus variant to date. The new variant contains more than 50 mutations in total , and its infectivity and vaccine resistance far exceed the Delta mutant strain. Only two weeks after its emergence, the number of cases infected by this new virus accounted for 90% of all new infections . In contrast, it takes 3 months for the Delta virus to reach this level.

However, Omicron ’s symptoms are “unusual but very mild.” South Africa’s National Institute of Infectious Diseases issued a statement stating that “the mutation of the virus is unlikely to be worse than the current mutation. Some vaccines will continue to provide a high level of protection. Effectively prevent hospitalization and death"

The next day, New York State Governor Huo Chu declared that New York State had entered a "disaster emergency" due to concerns about the influence of the Delta virus and the newly discovered Omicron mutant strain. We can deduce whether more states will declare a "disaster emergency" in the future, and we can't help but sweat for the tourism and catering industry.

What the market worries most now is

The new variant of the virus will increase travel restrictions, economic recovery, thus contributing to market delayed the expected time for the central bank to raise interest rates countries, where markets will be the Fed's first rate hike 25 expected time basis points, from next year 6 Yue postponed until next year 9 Yue , And believes that there will be no more interest rate hikes before 2023 . The postponement of interest rate hike expectations is actually good for US stocks, but the yield on the 10- year US Treasury bond plummeted due to the news , falling more than 15 basis points to 1.482% . The 30- year U.S. Treasury bond yield fell by more than 14 basis points to 1.826% . This is the biggest one-day drop since the last six months of 2021 .

The Fed’s current situation is very embarrassing

The Fed previously said that high inflation is short-lived, but inflation is now high. The Fed is forced to reduce the scale of bond purchases at a faster rate to control inflation . But now that the epidemic is coming again, it will probably hit the US economic recovery. Therefore, the US economy will continue to need quantitative easing policies, and quantitative easing directly affects US debt. This also explains why the yield of US Treasury bonds has plummeted, and the loan interest rate for buying houses The sharp drop again will cause the US housing market to continue to be hot.

From an overall point of view, it is too early to see how much the pressure of the Omicron virus poses to the global economy, but what is certain is that aviation, cruises, and gambling are not good opportunities for bargaining when the economy restarts. Home-concept stocks have been sought after again this week, and stocks of anti-epidemic and protective equipment have soared. For example, APT soared by 25%, AHPI soared by 54% , and LAKE soared by 9.9%.

Vaccine stocks are even more bullish. The MRNA of the Modena vaccine, which has been substantially corrected before, has soared by 20% . Pfizer PFE hit a record high. A Pfizer spokesperson confirmed in an email statement to Bloomberg: " If a vaccine escape variant appears, Pfizer and biotech expect to be able to develop and produce a customized vaccine for the variant within about 100 days, subject to regulatory approval. " Home and remote concept stocks are also sought after by ZM PTON DOCU TDOC .

U.S. stocks will continue to be shrouded in panic next week, investors will be very cautious, and, as I mentioned above, the selling pressure on Black Friday has not been fully released, and it will fall next week; moreover, just past The sales data of Black Friday in China did not boost investor sentiment . According to our survey on the US stock investment website, this year due to global supply chain problems, many goods are backlogged at the east and west coast terminals, resulting in insufficient supply of many merchants. They only offered small discounts, and the clearance merchandise offered by merchants on Black Friday this year was the lowest level in five years or more.

Analysts from the agency Cowen stated in the report that many shoppers choose to shop online and then pick up the goods instead of shopping in the store. Wal-Mart’s WMT and Target TGT ’s sales will be better than other retailers, partly because of their online purchase - to-store pickup services.

According to (Adobe Analytics ) tracking data of 80 retailers among the top 100 retailers in the United States, the total online sales in the United States this Black Friday is about 8.9 billion U.S. dollars, slightly lower than the 9 billion U.S. dollars in 2020 ; Thanksgiving Online sales on that day were US$ 5.1 billion, the same as in 2020 .

Agencies will not easily let go MAMATA of !!

FAANG outdated, Wall Street has a new code Mamata , facebook parent company M ETA, A pple, M icrosoft Microsoft , A Mazon Amazon , T Esla and Google's parent company A lphabet , each company's market value in trillions of dollars , Excluding NFLX , which has a market value of only $ 290 billion .

The market value of the six technology giants MAMATA accounted for more than 26% of the S&P 500. The market value is highly concentrated, setting a historical record. Their rise and fall directly affect the market. Apple, Amazon and Tesla will all be affected by the global supply chain. The epidemic is good for Microsoft’s business. Judging from the institutional positions of the most recent quarter, the positions of the institution MAMAA did not change much, but only fine-tuned the positions. Except for Tesla, Wall Street institutions chose to leave the market in the third quarter and settled. As of 9 Yue 30 , a total of 986 institutions shareholders clearance Tesla stock, and another 333 institutions were shareholders holdings. So that at the end of the third quarter, the number of Tesla institutional shareholders has decreased from 2048 at the end of the second quarter to 1,654 , and the total number of institutional shares has also decreased from 394 million shares at the end of the second quarter to 153 million shares, a decrease of 61.23% from the previous quarter .