Tradesk (2026)

22/01/2022

Cryptocurrencies tumble, with bitcoin falling 15% and ether down 20%

Bitcoin prices fell sharply on Friday, while ether prices also dived, wiping off nearly $150 billion from the crypto market.

Bitcoin fell about 15% and was trading around $36,000 late Friday, according to Coin Metrics. Ether, the second-largest cryptocurrency by market cap, dived about 20% to trade around $2,500.

The declines in cryptocurrencies follow Wall Street losses on Thursday. The Nasdaq Composite lost 7.6% this week, and the S&P 500 fell 5.7% for its third straight weekly decline.

Rising rates have prompted investors to shed positions in riskier assets. Earlier this week, the benchmark 10-year Treasury yield traded above 1.9%.
A common investment case for bitcoin is that it serves as a hedge against rising inflation as a result of government stimulus, but analysts are saying the risk is that a more hawkish Federal Reserve may take the wind out of bitcoin’s sails.

As yields pulled back later in the week, however, foreign exchange trading firm Oanda senior market analyst Edward Moya said it was “a little disappointing to not see bitcoin react more positively to the reversal in Treasury yields.”

Bitcoin prices have fallen sharply since November, tumbling more than 40% from a record high of about $69,000.

Some experts warn that the crypto market could be heading toward a downturn soon, as heightened regulatory scrutiny and intense price fluctuations dampened bitcoin’s prospects.

The Federal Reserve have also indicated it plans to begin reducing its balance sheet, as well as tapering of bonds and raising interest rates.
Regulators are cracking down on cryptocurrencies too. China completely banning all crypto-related activities and U.S. authorities are also clamping down on certain aspects of the market.

In a Thursday note, Oanda’s Moya had predicted that bitcoin could tumble below $40,000 as Russia’s central bank had proposed a ban over the use and mining of cryptocurrencies on Russian territory, claiming the digital currency poses a risk to “financial stability and monetary policy sovereignty.”

Russia is among the top three countries for bitcoin mining, he noted.

20/01/2022

China’s central bank cuts key lending rates, including one for the first time in nearly 2 years.

China’s central bank cut its benchmark lending rates again on Thursday amid concerns about an economic slowdown in the world’s second-largest economy.

The People’s Bank of China reduced the one-year loan prime rate by 10 basis points from 3.8% to 3.7%. In December, the PBOC cut the one-year loan prime rate for the first time since April 2020.

The five-year loan prime rate was lowered by 5 basis points from 4.65% to 4.6% — it was the first cut since April 2020, at the height of the coronavirus pandemic in the country.

Loan prime rates (LPR) affect the lending rates for corporate and household loans in the country.

Most new and outstanding loans in China are based on the one-year LPR, but the five-year rate influences the pricing of home mortgages, according to Reuters. A snap poll by Reuters had showed that most participants expected China to slash both the lending rates on Thursday.
The rate cuts continue the PBOC’s efforts to push down borrowing costs, according to Capital Economics.

“Mortgages will now be slightly cheaper which should help shore up housing demand. The PBOC has already pushed banks to increase the volume of mortgage lending,” Sheana Yue, China economist at the firm, said in a note following the announcement.

“Targeted support for property buyers does appear to be limiting one of the more severe downside risks facing the economy,” Yue added.

However, Nomura’s Chief China Economist Ting Lu said the impact of the LPR cuts “will be quite limited, as these cuts are too small to have a material impact.”

“They are unlikely sufficient to clear up the real bottlenecks, and because rates on existing mortgage loans will not be reset this year,” he wrote.

Nomura expects further cuts to the one-year and five-year LPR as well as the reserve requirement ratio, and a “significant rise in FX purchases to add liquidity and limit [renminbi] appreciation over the next few months.”
Though China was the first major economy to shake off most of its pandemic-driven economic shock, concerns grew last year around the sustainability of growth. They came as a result of muted consumer spending, tighter regulations, a struggling property sector as well as Beijing’s zero-tolerance Covid policy.

On Monday, the central bank defied market expectations and lowered borrowing costs of medium-term loans for the first time since April 2020.

The PBOC said it was reducing the interest rate on 700 billion yuan ($110.33 billion) worth of one-year medium-term lending facility loans by 10 basis points from 2.95% to 2.85%.

Bruce Pang from China Renaissance noted that the central bank’s cuts to different rates would help both the slumping property market and struggling small businesses.
The varying cuts send a rather strong signal for policy direction, he said. They reflect how the central bank is responding more quickly with efforts to lower financing costs, ease pressure on the property market and spur consumption and investment.

The Chinese economy grew by 8.1% in 2021 as steadily growing industrial production offset a drop in retail sales. Still, that figure fell short of economists’ expectations for an 8.4% growth.

19/01/2022

Sony shares tank over 12% after Microsoft and Activision’s $68.7 billion tie-up plan.

Sony shares fell more than 12% in Tokyo on Wednesday after Microsoft announced plans to buy Activision.

Investors likely fear rising competition to Sony’s PlayStation division as well as the potential for Microsoft to pull some popular games from the Japanese entertainment giant’s platforms.

For some time, Sony has been ahead of Microsoft with its portfolio of first-party games, allowing it to stay ahead in the console wars. But should Microsoft close the acquisition of Activision, it will have a strong portfolio of hit games from the Call of Duty franchise to World of Warcraft.

That content can help power Microsoft’s subscription strategy around Game Pass, a pay-monthly service that allows users to access a library of games across different devices. It is a rival to Sony’s “PlayStation Plus” and “PlayStation Now” services.

When console makers own the gaming studio, they often make those games exclusive to their platforms. Games like Call of Duty are currently available on both PlayStation and Xbox.

But investors fear Microsoft could take those games off of PlayStation’s platforms, giving the U.S. company more attractive content to rival Sony.

“There is no doubt that this deal weakens Sony position in the market,” Piers Harding-Rolls, games research director at Ampere Analysis, said in a note published Wednesday.

“Whether or not Activision Blizzard’s content is progressively made exclusive to Xbox platforms and services, inclusion of new releases into Xbox Game Pass for several major games franchises, including Call of Duty, will undermine Sony’s third-party business. Sony has benefitted from the ability to negotiate timed exclusive content for Call of Duty but this is now under threat.”

Overreaction?
Sony has been investing heavily in first-party exclusive content for some years which has allowed it to bring exclusive hit games such as Spider-Man and The Last of Us to the PlayStation.

Meanwhile, it has been investing in virtual reality and this month took the wraps off its second-generation headset called the PlayStation VR2.
Serkan Toto, CEO of Tokyo, Japan-based consultancy Kantan Games, said Sony will likely continue to focus on strong content.

“Sony will still continue to push out blockbusters, there can be no doubt about that,” Toto said.

“I think the market has totally overreacted in Japan today,” he added.

Sony itself is no stranger to acquisitions albeit nowhere near the size of Microsoft. Last year, the Japanese firm swallowed up a handful of small studios including Valkyrie Entertainment, the maker of hit game God of War. Toto said Sony will likely hunt for further acquisitions.

“Sony can of course fight back: they still have their own top in-house studios spread around the world, PlayStation remains a powerful brand in gaming, and acquisitions are in the cards for Sony as well,” he said.

18/01/2022

Netflix raises prices in U.S. and Canada, stock pops.

Netflix raised monthly prices for its streaming service in the U.S., sending the stock up as much as over 3% during trading on Friday.

Netflix stock ultimately rose 1.25% to close at $525.69 on Friday.

The monthly cost for the basic plan rose $1 to $9.99, the standard plan jumped from $13.99 to $15.49, and the premium plan rose from $17.99 to $19.99, according to Netflix’s website. Canadian prices increased as well.

A Netflix spokesperson confirmed the change. “We’re updating our prices so that we can continue to offer a wide variety of quality entertainment options,” the spokesperson said in a statement.

Netflix has been raising prices in previous years and it is part of the company’s long-term strategy. Netflix previously raised prices for U.S. customers in 2019 and 2020.

Wall Street has been counting on Netflix to increase prices as customer growth wanes. Netflix’s price increases also reflect confidence from the company that its plans are entrenched in its customers’ lives and that they will not cancel or churn because of price increases.

Netflix said on Friday that customers will receive an email about the price increases 30 days before they see the increase.

Netflix is facing more competition than ever, especially from newer streamers including Disney+, HBO Max, Amazon’s Prime Video, and Apple TV+. Netflix said last fall it had over 213 million subscribers around the world, which is much higher than the subscription count of its new rivals. As a result, Netflix has been investing heavily in producing content for its service, and said it expected to spend $17 billion on content in 2021.

Netflix reports quarterly earnings next week.

18/01/2022

10-year Treasury yield jumps to 2-year high, topping 1.83%.

The yield on the benchmark 10-year Treasury note soared 5 basis points to 1.8305% at 3:40 a.m. ET. The yield on the 30-year Treasury bond climbed 3 basis points to 2.1492%. Meanwhile, the 2-year rate topped 1% for the first time in two years, hitting 1.0364%.

Yields move inversely to prices and 1 basis point is equal to 0.01%.

The move, which comes after a market holiday in the U.S. Monday, indicates that investors are preparing for the possibility of more aggressive tightening by the Federal Reserve.
Last week, Fed Chair Jerome Powell told the U.S. Senate that he expected to see a series of interest rate hikes this year, along with a pullback in other pandemic economic support measures.

Philadelphia Fed President Patrick Harker told CNBC last week that the central bank could raise rates three or four times this year. He noted that inflation is “more persistent than we thought a while ago.”

James Athey, senior investment manager at Aberdeen Standard Investments, told CNBC that the sudden spike in yields couldn’t be explained by any one new piece of news.

“The reality is that the market is still adjusting to the Fed’s ongoing hawkish evolution,” he said via email.

Athey referred to JPMorgan CEO Jamie Dimon’s comments on Friday, when he said the Fed could hike rates as many as seven times this year, according to multiple reports.

These comments, along with speculation that the Fed may hike rates by 50 basis points as soon as March, “are driving the front end to reprice which is dragging all yields up – though notably still the curve is flattening,” Athey said.

“Technically we look a little bit stretched given the pace of this repricing so I expect to see some consolidation around here – especially as the Fed is in blackout and they are the main driver of higher yields at the moment,” Athey explained.

Fed officials have gone into a no-comment “blackout” period ahead of the next central bank meeting on Jan. 25-26.

In terms of data releases due out on Tuesday, the January National Association of Home Builders housing market index is expected out at 10 a.m. ET.

Auctions are scheduled to be held for $60 billion of 13-week bills and $51 billion of 26-week bills.

23/12/2021

Amazon among key tech firms to drop CES plans on Covid-19 concern.

Amazon, Facebook parent Meta, Twitter and Pinterest will not send teams to the Consumer Electronics Show (CES) in Las Vegas as concerns grow about Omicron, the firms said on Tuesday.

CES, which serves as an annual showcase of new trends and gadgets in the technology industry has attracted more than 180,000 people from around the world to a sprawling array of casinos and convention spaces in the past.

Amazon and its smart-home unit Ring said they would not be onsite at next month’s event due to the “quickly shifting situation and uncertainty around the Omicron variant” of coronavirus, the firm’s spokesperson told Reuters in an email.

Bloomberg News first reported that Amazon and Ring had decided against in-person presence at the show.

U.S. wireless carrier and conference sponsor T-Mobile also said the vast majority of its contingent would no longer be going and its chief executive would not deliver a keynote speech.

“We are prioritizing the safety of our team and other attendees with this decision,” T-Mobile said, while expressing confidence that CES organizers were taking exhaustive protective measures.

The other companies had not planned large in-person gatherings.

The Consumer Technology Association, which runs CES, said on Tuesday the show would run from Jan. 5 to Jan. 8. Health precautions would include vaccination requirements, masking and the availability of COVID-19 tests, it added.

Twitter had planned to have some employees attend, to participate on panels. However, both Twitter and Facebook have said they are now exploring online opportunities.

Pinterest, before canceling, had planned a scaled-down meeting area for its sales and partner teams, compared to years past.

But many companies, such as Qualcomm, Sony Electronics and Alphabet’s Google and self-driving vehicle unit Waymo have said they are sticking with plans to attend and show off new hardware or host meetings.

On Tuesday, General Motors said Chief Executive Mary Barra is still set to introduce the U.S. automaker’s electric Silverado pickup truck and discuss company strategy in person at the conference on Jan. 5.

Other companies had long ago planned for virtual presences, among them chipmaker Nvidia, which is having two executives deliver a keynote address by video.

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