Commodity stocks soar on Monday–everything else? Meh
Monday was a great day to be invested in stocks. As long as you were invested in commodity stocks.
Just what the global economy doesn’t need–more supply chain disruptions on a Covid outbreak in China
The Chinese government is holding to its Zero tolerance policy and has imposed shutdowns on a large part of the country’s economy to suppress China’s largest surge of OCovid-19 infections since the beginning of the Pandemic.
China has ordered lockdowns in some of its largest factory cities, including Shenzhen, the city that is China’s technology center. The city of 20 million stopped buses and subways on Sunday night and ordered business to close except for supermarkets, farmers’ markets, pharmacies, and port facilities. Donggun, another huge factory city near Shenzhen went into lockdown today. The lockdowns will disrupt companies around the world from Apple (AAPL), which will suffer from the shutdown of factories run by the companies that assemble its products, to MGM Resorts International (MGM), which faces restrictions on travel to its Macao casinos.
While U.S. stock exchanges closed for Presidents’ Day, China’s financial markets in turmoil
The themes should be familiar by now. The Chinese government’s crackdown on the country’s big tech companies continues. And there’s new bad news from a company thought to be safe from the real estate crisis.
China’s state funds buy shares of U.S.-listed tech giants
With the end of the Lunar New Year holiday and the reopening of China’s stock markets, China’s state-backed investment funds have started buying shares of the Chinese stocks traded on U.S. markets. The move follows actions by the People’s Bank of China to inject cash into the economy and financial markets.
Should you invest in China now? Attacking the puzzle with buys on Monday of TCEHY and FXI
In other years this would clearly be the time to jump into China stocks. What we have right now is a classic, tried-and-true set up for big gains from buying China stocks. With a “but” or two that suggests a cautious strategy. But I will be buying shares of Tencent Holdings and the FXI ETF on Monday, January 3.
Trick or Trend: Request from China’s Didi Global to delist in New York hammers U.S.-traded China stocks
On Friday news that China’s Internet food delivery giant Didi Global (DIDI) planned to delist its shares from the New York Stock Exchange hammered the stock in New York trading. Didi’s ADRs fell 22.24%. And other Chinese stocks with New York listings followed the path downward pioneered by Didi Global. Abibaba (BABA) closed down 8.29%. Tencent Holdings (TCEHY) slid 4.87%. And JD.Com (JD) dropped 7.71%.
Stocks rise on McConnell debt ceiling news and Xi meeting hopes
Stocks climbed today on news that Republicans in the Senate had agree to suspend the debt ceiling until December. That puts off a potential “selective” default by the U.S. government until that month. Stocks, especially those with China exposure, also rallied on news today that China’s president Xi Jinping would meet with U.S. President Joe Biden before the end of the year. The assumption is that the two leaders would be able to take some of the current tension out of the U.S.-China relationship.
More Evergrande woes in China but biggest selling is in U.S. tech stocks
The Hong Kong Stock Exchange suspended trading in shares of China Evergrande after the Chinese devel... To subscribe to JAM you need to fill in some details below including, ahem, some info on how you'll pay us. A subscription is $199 (although if you're subscribing...
People’s Bank supports markets (and Evergrande) a little bit
I’d call the policy being followed by the People’s Bank in the China Evergrande crisis “Try to support the markets but see how little we can get away with.” Today Chins’s central bank supplied liquidity to the country’s financial markets with an injection of short-term cash. But the move fell far short of the kind of “Charge of the People’s vanguard” that the bank has mustered in earlier crises. And, importantly, there was no big statement of market support to go with today’s actions.
Will a 5% drop bring out the buy on the dippers? Not, I’d argue, until the People’s Bank makes a move
The Standard & Poor’s 500 fell another 1.70% today and it’s now down 3.94% from the September 2 high. As the index dropped last week (again) and over the weekend, lots of Wall Street money managers said Hey, stocks were over-valued and news from Beijing and Washington (and places in between) is negative, but if stocks drop 5% we will be buyers. It looks like might get to test that conviction sooner than anyone expected. Which way will things break on another decline?
Watch my new YouTube video: Time to Worry About China Too
I’m starting up my videos on JubakAM.com again–this time using YouTube as a platform. My forty-seventh YouTube video “Time to Worry About China Too” went up today.
Solutions for my YouTube video on September/October risk–What to do? 5 Moves
Back on September 4 I posted a video on YouTube and this site “September and October 2021 Worse Than Usual for Investors?” that argued that September, the worst performing month for the Standard & Poor’s 500 from 1950 through 2020, and October, historically the home of the biggest one-day or one-week stock market crashes, stood a good change of being even worse than usual this year. I cited factors such as the Fed’s September 22 monetary policy meeting, a potential stalemate over the raising the debt ceiling, and economic uncertainty created by the Delta Variant (see last weeks weak jobs report as evidence on that front) as reasons for thinking that we could see a repeat of the historical weakness and volatility this September and October–but with a bit of supercharging. I don’t want to revisit all the reasons I gave in that video–Hey, just watch it, ya know?–but let me add a couple of points that I didn’t mention in the video. Like the effects of the continued shortage of chips on car manufacturers and hence car sales. Like the run-off in federal Pandemic economic help that’s now scheduled for this fall. Like signs of weakness in consumer sentiment and business confidence. Instead of more on “the problem” lets talk about potential solutions- the “what should I do stuff.”
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