 Okay, very good morning to you. It is Friday 17th of December. I hope you're doing well and before I begin the briefing Don't forget to check out the market maker newsletter goes out daily But a special edition goes out at the weekend encapsulating all of the major events that have happened not only in global markets But single stock news the crypto DeFi space SPAC deals IPOs So if you really want to stay informed of everything that encapsulates the whole week And certainly if you're a student looking to improve your commercial awareness for any interviews or upcoming applications This is hopefully going to be useful for you. So feel free to join. It's absolutely free It goes out every day as I said special edition goes out on the weekend on a Saturday But let's get straight to it and let's talk about what's been going on in markets I'm not going to dwell too much on the charts because there's plenty for me to talk about and so gonna start Predominantly on the close of Wall Street where we did see quite heavy selling pressure yesterday And in fact the tech space got hit the hardest Then as that finished down around two and a half percent whereas the S&P and Dow were down about nine tenths Big tech giants Apple were down about four percent of the close last night Tesla down about five We'll talk about them a little bit more in a moment But in terms of a short-term sector play, I think as the markets really digested the overall policy hawkish Switch that we've seen from the Federal Reserve although markets did rally post that event I think upon further contemplation and digestion. We did start to see this idea Well look not only are we accelerating tapering We're also going to be hiking interest rates more aggressively and so what you started to see was a bit of an exit out of high performing growth tech names and a pivot more into those Rate sensitive economic sensitive Companies so financials were big out performers yesterday This can be to be evident as well as you can see here the Nasdaq's relative underperformance that we've seen Through really throughout this week and particularly after and post the Fed announcement which came later also earlier this week one of the things I wanted to talk about was a Quick look on the COVID update But on the US specifically because we see a lot of attention drawn to the UK given the severity of the outbreak that's occurring right now But the US hasn't really taken off to the same degree as yet But it's likely to do so given how transmissible the new variant is So a couple of stats to be aware of over the past month new cases have risen nearly 40% To a seven-day average of 121,000 infections per day is happening in the US at the moment As you can see here deaths have risen 18% since since since mid November and COVID Hospitalization rates have risen about 45% over the last month So yeah, we definitely continue to keep an eye on this because of course from an overall global perspective sentiment-led asset class Across the different asset classes Now if the US starts to see meaningful impact from newly implemented restrictions And this is going to be very important particularly in the context of the Fed who've kind of pushed ahead You know basing more predominant focus on the economy Developments in the labor market and specifically inflation over the kind of risk so much to Omicron Although they did kind of warn they have flexibility to react in that regard So this is kind of the early signs Timings wise if you think about what we've had through the pandemic The UK's always been very early and then the rest of the world starts to see the flare-ups So we'd expect these numbers to continue to rise Meanwhile in the UK, obviously you would have seen a new Record infections just over 88,000 that's up nearly 75% on a seven-day rolling average Chris Whitty England's chief medical officer He warned that it's entirely possible that daily hospital admissions due to the Omicron variant could surpass previous coronavirus waves Hospitalizations in the UK you can see here still low very much so comparative to where we were Kind of this time last year However are heading up at the moment and obviously it's a laggard effect To where cases are at the moment and cases are likely to go much higher at this point in time So despite the more mild symptoms if that figure of cases is large enough proportionately you would expect hospitalizations in step to rise as well and I was looking at this chart from the FT last night this is looking at acute hospital bed occupancy in London and Although it's tracking pretty much similar to what we had in 2020 to 21 We are well above what is the historical average over the winter period So remember this Omicron outbreak the reason when these numbers are already so high is that they're on top of the already What was existing Delta? It's just the Omicron now will become the more dominant strain going forward much like what we've been seeing in London over the course of the Last week given that seen a much greater acceleration than other parts nationally So yeah a lot of developments here and still warrants quite close monitoring of course The other thing is then flipping over to politics one thing we've been talking about since the beginning of the week Was this by-election happening in North? Thropshire not that that's a particular meaningful area, but it was going to act as pretty much a litmus test for sentiment overall for what has been a disastrous period for Boris Johnson the conservative party for a number of different reasons Criticism over Downing Street parties the new COVID restrictions coming in the sleaze scandal that ultimately Led to this by-election, which was the previous MP Omin Patterson who had ran this seat since 1997 kind of breached parliamentary rules on lobbying So it's all happening at the moment for Boris Johnson and of course it comes in the context of his biggest rebellion Yet since his leadership began when a hundred conservative MPs voted against those protocols for COVID passes in England Just two days ago. So it's the first time in basically nearly 200 years That the seat has flipped and it's gone Very comfortably to the Lib Dems who were third last time this by-election happened in 2019 So really just a reflection I guess of the general perception of how the Tory party is doing at the moment It's likely to just heap more more pressure on Boris and questions internally within the party on his validity to lead. I don't think it's anywhere near the point of some sort of Rebellion to oust him to that degree But it's certainly going to be causing him some severe headaches at this point in time an interesting thing that I thought Was in the press this morning and I think it's gone relatively unnoticed is the UK has to drop key ECJ demand European courts of justice demand on Northern Ireland trading Now very similar to I think what we've had with this whole kind of dead cat strategy Boris was under pressure a week or so ago and then he came out with a very unexpected and very rapid adoption of Plan B measures and Some would suggest that that's a bit of a distraction tactic to deflect the optics onto something else other than the negative press that he was getting and I thought this was interesting because it's always been the UK's kind of red line They don't ultimately want oversight out of Europe on some of the end trade deals that happen with Europe but here they are now and Frost is going to be speaking with his European counterpart today and repeat and reportedly the UK might drop that demand about the ECJ Having no legal role in Northern Ireland protocol in order to de-escalate tensions and to improve trade trade negotiations and so Yeah, I think overall it's probably I Guess the strategy here from the government is one of which I think publicly Brexit is so far down the pecking order of priorities in a in the current current COVID context That it allows the government a little bit more flexibility Then to get a deal done when in a post pandemic world Touch wood when that comes, you know Brexit if not done Carefully and in a constructed way is going to have a negative economic impact And so if they can then start to incorporate These kind of factors to satisfy Europe to secure that trade deal then all the better for it And can they know the reasons why they wouldn't know have been able to do it before is because there's people's Feelings towards Brexit and what does Brexit mean and the stance of which the party has led to got Boris into government But if everyone's distracted by everything COVID will then allow some movement for deals to be struck Whilst people aren't concentrating on the details. I'm talking the public here about Brexit. So yeah Just interesting to watch how this plays out Moving over then a few other things just really quickly to comment on Goldman Sachs have come out with some new commentary about Brent crude as you can see here and the main thing they're saying is that They say a hundred dollars a barrel cannot be ruled out in 2023 a supply additions are expected to be slow To keep up with record demand the banks say the recent sell-off is overdone As unnecessary concerns about Omicron related restrictions and they Expect investors to buy the dip once asset managers Reallocate money next year the latter point. I don't have too much of a problem with the former point. I think Goldman's are being a little bit complacent if I if I can say that I mean, I've always been a bit of a COVID bearer in a sense that I think that people have always Underplayed this type of situation we're seeing now. I think anyone who's been following this channel for a while probably recognize that from my view But let's see. I mean, there's certainly it's very bullish commentary And if we are talking about out into 2023 and beyond sure I'd say even naturally the kind of cycle of waves of COVID Will have got incrementally smaller Vaccines and and further top-up boosters would have been rolled out. Yes It's going to come ever more economically less impactful most likely and so don't disagree on that timeline But yeah, I think being ultra bullish at this point in time. I'm not particularly as comfortable with in the short medium term Terms of the BOJ if they had their rate decision kind of wraps up then the plethora of decisions We've had throughout the week and you know, it's been super interesting, of course because we've had the Fed accelerate tapering Talked about more further three interest rate hikes in 2022 the Bank of England shot the markets again and Hike rates yesterday while the ECB followed through with their plans about Some transitional effects with their QE program as they fade out that pandemic emergency purchase program by March of next year The BOJ they've dialed back their emergency pandemic funding but maintained their ultra loose policy They extended financial relief that they do for smaller firms and really just to show the divergence here if you know The Fed are that way down the track in in kind of reversal withdrawal of Pandemic induced stimulus. The BOJ is right on the other end of that spectrum So no real reaction seen to that overnight No real surprises from the BOJ a couple of quick trending stock stories. I wanted to touch upon Rivian just because The EV market was just exploding a few months ago But the bubble has kind of semi burst now and it's a little bit of a reality check when these EV makers start to report their actual factual numbers and Rivian shares to kind of out 4% overnight Aftermarket trade after revealing that they're gonna fall short of their target their annual production target They're only producing aiming to produce around 1200 vehicles and they've still got a full short They said by a few hundred even at that they posted a net loss of 1.23 billion Company is also planning on building an EV battery plant, which is going to cost them a core five billion dollars This is all in part to achieve their manufacturing capacity target of around 400,000 vehicles annually starting by 2024 bit of context, of course Rivian has been a hot stock of late They came off 4% last night on the back of this, but they were up 40% since their IPO, which is not that long ago So yeah context is important Elon Musk Yeah, he's at it again, of course He's now disposed of around three quarters of that 10% stake that he said a few weeks ago that he would Offload he got rid of another roughly 900 million last night according to latest regulatory filings I think what's so interesting about about Elon Musk is just his use of social media tactics We've talked about this plenty of times before you probably would have seen about two days ago He came out saying look let's start accepting dogecoin for some Tesla merch and It's just so obvious to play the tactical approach here. It's the more The more he sells these shares the more outrageous his tweets come And they're very much in check with one another as he tries to manage the exit to cover the taxes on exercising his options basically so You know since this has happened though one thing to be clear is that Tesla shares if you go back It's only around five or six weeks ago when we were peaking and you know Tesla's market cap was crazy at 1.25 trillion dollars after this explosion that we saw in late October Bit bit of a rain check now. We broken down through a technical area of around 935 that had been holding support throughout the week Probably now shaping up for next era support around 909 910 which would be a gap down then to that that jump that we saw on the weekend on the week commencing the 25th of November The loss here from the high then is now knocking on 25 heading to 30% if we get that moved down to 900 bucks so yeah, certainly a bit of a Return to some degree of normality now after that Crazy run that we had lately. The other one is is reddit They've jumped on the IPO ban wagon their valuation is said to be around 15 billion At the time of its flotation again All of this coming on the back of their popularity surged that they saw actually at the beginning of the year I can't believe GameStop was actually at the beginning of the year. It feels like that was two or three years ago now So it's taken them a while. They've probably missed much of the euphoric kind of interest in reddit But nonetheless looking to take advantage in list and that IPO is set to happen All right, looking at the calendar for today. We've already had UK retail sales come out this morning and just going to Flash over to the calendar. So here Just having a look at that story actually came in quite a bit stronger than expected for November 1.4% against expected 0.8 Which was also the same as the reading in the prior month The stats office said that widespread discounting from Black Friday was a large significant contributing factor But there's two other things I think that are quite important One is I think a lot of consumers were bringing forward their their Christmas spending early because of fears of potential Supplying constraints, which has been very much kind of talked about in the press and thus become somewhat self-fulfilling Where consumers want to take advantage as well of discounting over Black Friday and then secondly If you think about markets are forward-looking right and so Omicron has got worse and he's going to get It's going to probably result in further Restrictions and that's going to impede then likely at least on the high street Sales, but obviously we'll see whether we see that behavioral shift or more online purchases But the idea being here is that the Omicron variant spread Could well mean that these numbers might have seen their their short-term peak for for the time being otherwise just having a quick look elsewhere back at the calendar and we got German iPhone and That's coming out nine o'clock. We are expecting a slight downward move to ninety five point three From ninety six point five. So good to get a sense check then on how German corporations feel at the moment Remember even before the Omicron spread We were already seeing quite onerous restrictions being adopted in Germany and elsewhere mainland Europe Remember their overall vaccine take-up has been relatively low compared to their European peers And so you would expect then general corporate sentiment to be fading a little bit HICP final winning for Eurozone at 10 is final. So not expecting too much movement there and then if we look at the Overall calendar for this afternoon. There's nothing major coming out of the US So very much. I think going to be a continuation of two things really one Equities do we start to see a continuation move from what we had yesterday stocks traded fairly heavy under performance in tech Digestion over this whole kind of Fed pivot in a hawkish direction, which we've seen kind of echoed by some of the other major central banks And also that then of Omicron still being a key factor as well to throw in the mix We've also got quadruple witching happening today. So as a reminder refers to The exploration of stock index futures stock index options stock options and single stock futures And they all happen at the same time and for the US indices. That's going to be at the nizy open All right, that is it So I'm gonna leave it there. Let you guys have a good session ahead. Have a great weekend Don't forget as well to check out the link I'll put it on the bottom of this video if you watch you're on YouTube to subscribe to catch that weekend market maker newsletter All right, take care