 Okay, very good morning to you. It is Wednesday the 3rd of February. Hope you're doing well Let's get straight to it and talk about this guy here Jeff Bezos came out last night bit of a surprise announcement with the Amazon corporate earnings and said he's going to step aside As the Amazon CEO so going to talk a little bit about that. What's my view? Why has he done it? What does this mean for the company? How can we expect their share price to perform as it goes through the session going forward? And then also to update you on a few other things alphabet have really spectacular earnings last night They're trading up over 7% in aftermarket trade Mario Draghi confirmed from reports in Italian press at the weekend that he's tipped to become the new Italian Prime Minister But a few key obstacles he needs he needs to hurdle first Then we've got an update on the Oxford Astra Vaccine and the idea about the efficacy rates over two dosage shot In terms of some more positive news and then we've got API opportunities and then just generally the day ahead so quick look at the overall market sentiment here at the open and the dollar still holding on to some relative gains that we've been seeing over the last two sessions and the Dixie is Up about one tenth of one percent will be just off the highs that we printed yesterday So the major pairs still trading a little heavy You're a dollar here top left as I'm speaking just touching fresh session lows for the moment Again, technically, I'd be keeping an eye just down toward the lows that we've had before and if we look on the daily chart You know, we do start to bring in some fairly meaningful levels when we start talking about 120 which has always been a relative symbolic level for the ECB in terms of their overall perception of euro strength And in this case coming back down that would be a key area support to have a look at yesterday's low that was seen late in the evening amid the kind of Short-term dollar strength. We've been seeing that would come in around one twenty twenty seven in the futures on the upside top end of the Range a decent air resistance seen at the pivot, which would also be yesterday afternoons hired around that one twenty fifty eight So cable just backing off a little bit as well But these major pairs down only moderately so about ten pips elsewhere stock index futures positive again That's future knocking on the door of what was the overnight Asia Pacific session high here in the center left This comes after positive closes were seen on Wall Street. We closed up one point four percent For the S&P one point six percent roughly so for the down and that's that one hundred last night This was before then these mega cap tech earnings came out otherwise elsewhere T-notes broadly flat down just a tick and WTI crude has had an interesting Session or so just keeping an eye on the price action here Generally prices very elevated as we saw yesterday We did close above a very meaningful level here from a technical perspective Which was going back to the 20th of Feb of 2020 so one year high more so here for crude And technically speaking on the upside there is a bit of clean air until we get further up really towards price levels We weren't seeing until the beginning of last year up at around 56 27 and it comes after some bullish data We had from the API for trees The DOE's will get later on today, but look, let's talk Amazon. Let's get you up to speed and what's going on and The numbers let's talk about the numbers for Amazon first because they were pretty spectacular as have really all of these big tech stocks from Microsoft to Apple to Alphabet and Amazon, you know, they these companies during this pandemic environment have really taken it to a whole new level And obviously revenue wise breaching this kind of milestone one hundred billion dollar figure So their revenues were a hundred twenty five point five six billion dollars for the quarter higher than expectations of one nineteen spot seven operating income six point nine billion a CQ one net sales in a range basically Around one of six to one ten expectations were for just ninety five point seven billion So they're very bullish about the future their EPS was more than pretty much double consensus came in at fourteen oh nine And actually watching their share price When the initial news came out about Bezos their shares were a little bit mixed I was watching the aftermarket activity and their shares initially dropped came back positive And then they were kind of flatlining and then the company came out in the conference call and said that Covid expenses in Q1 will drop to two billion from four billion In Q4 mostly seen due to the fact that warehouses are less busy than what they were during the holiday quarter, which makes sense So there's less cost implications of PPE and keeping the workers safe in warehouses And that's quite a that was a dramatic headwind for the company previously So that being eliminated out another net positive as well and their shares actually moved a little high and aftermarket trade And that comment came out but look let's talk about Bezos and you know what is going on because this wasn't exactly a scheduled announcement And I guess you know when we have these kind of significant companies like this Of magnitude and also notoriety in terms of their leadership in the form of their CEO I mean Bezos is the guy that was obviously there and his garage selling books back in the 90s and to take it to this They're kind of monster-sized company now Obviously, there's going to be a little bit of initial Interpretation of just apprehension. What does this mean? It's going to lose its real spearhead. It's driving force But you know, I think any sensible CEO would be aware of this Factor and the transition process would have been smooth the delegation of Responsibility and strategy decision-making would have been spread in order to take away from yourself You would definitely not want to put yourself in the situation Kind of like what Elon Musk has done where I think if Elon Musk got run over by a bus tomorrow I'm afraid Tesla's shares would get absolutely decimated Any other sensible CEO would rather do the complete opposite Which is as good as it is to be this PR machine that Musk is and undoubtedly He is the driving force has created this Phenomenal story that is Tesla, but in terms of longevity it does create significant risks You probably saw yesterday Musk is taking a break from Twitter. We'll see how long that lasts I think last time he said he was taking a break on Twitter It lasted literally a couple of days before he had a pop shot at guess who Jeff Bezos and Amazon So I believe that for a second But Bezos is going to step aside. He'll transition to the role of executive chair So this is point one that I think is good to understand executive chair is still pretty involved Still pretty hands-on. I mean the difference here from a definition points of view to CEO's kind of Implementation running of the strategy Ultimate line of responsibility But the responsibility to the board of directors really lies with the executive chair And so he would still preside over the company's general stability and so on and he has said himself that he'll continue to remain Quite active in the business. So again, it's kind of a it's not like he's completely removed and off he goes He still definitely will be there But overall who's going to be I guess the biggest question who's going to be his replacement. Well, it's a guy called Andy Jassy now those who followed the Amazon stock will be very familiar with Andy because he's a long time Kind of member of the the Amazon family He was one of the first kind of more technical assistance that Bezos took on back in the late 90s I believe he joined the firm in 1997. He is currently and has been the longtime CEO of the Amazon web services and Amazon's clown computing business now That will be meaningful for many of you because that is really the real dominant growth area of this company AWS So it's a very assured safe Recognized consistent pair of hands for the company to be moving over to Andy Jassy What is Bezos said in terms of his rationale? He said as executive chair I'll still be engaged in important Amazon initiatives He also will have the time and energy to focus on other things and the things he noted with day one fund the Bezos Earth Fund Blue Origin the Washington Post and many other passions and actually that latter one talking of the Washington Post That is something which I think is quite meaningful because he has so many other business interests some of them like the Washington Post start to venture in into say global politics Bezos was someone who ran and clashed with the previous US president Donald Trump and if you remember the US President and Administration decided to go with Microsoft for the $10 billion Jedi project with the Pentagon That was a big blow for Amazon and a big win for Microsoft at the time and a lot of that being a kind of indirect impact of the fact that Obviously Bezos through his publications has been quite critical of the administration He's had similar situations with Amazon's growth in India and the existing government and how they've dealt with various domestic issues So does make some sense in that respect for him to step away You know, I guess, you know, when you're one of the world's richest men, what really drives you motivates you I mean making a hundred billion dollars is a nice, you know kind of symbolic thing to leave on I would say You know when someone was to say to you, I know it sounds crazy But hey Jeff, how do you feel about shooting for 200 billion quarter? I mean Amazon will print a 200 billion dollar revenue quarter in the future I have absolutely zero doubt in my mind But how much of a motivator would that be for someone like, you know, Bezos It's kind of like that prospect theory curve the payoff is getting ever less of the bigger it gets So I don't think there's much motivation there Whereas things like, you know, the Blue Origin fund things like that are significantly behind Some of the initiatives being led by Elon Musk And I think that's the type of stuff that really drives these guys is competing on these other areas beyond their own kind of core business In that respect, you know, the guy's got divorced recently. That obviously was a big hit not just financially I'm sure emotionally as well. So, you know, I can understand lots of different reasons of why this might have taken place So, yeah, that's my overall kind of view on things I think for the stock price in itself for Amazon shares I mean, look, this is what Amazon did overnight and in fact Amazon pretty much flatlined So a sensation was the headline sounds the stock price really so far in aftermarket trade The initial perception hasn't been a massive negative as what I guess assumptions would have been Obviously, we'll wait for the market open today see how it performs But it'll be indicative then of generally that this would be relatively smooth orderly transition of power again I definitely don't see this as an as a as an Elon Musk situation If this was talking Tesla and he just walked away for whatever reason This chart would look radically different But I think the strategy from from Bezos and the transition to Jassy will be a relatively smooth one The other one aftermarket was Alphabet. You can see here huge jump in their share price in aftermarket trade So they went up around 7.4 and extended hours their revenues 56.9 billion firm and unexpected operating margins at 28 percent operating income of 15.65 billion EPS at 22 30 against 15 58 What basically underpinned this phenomenal print of numbers from from Alphabet was heavy digital Appetizing spend during the holiday season as you can imagine the company really making huge steps forward in in those figures Mainly based on the fact of COVID-19 and that many businesses now are having to pivot away off traditional kind of high street physical Retail selling into the online format and so bringing in new participants as well as those ramping up their budgets to try and tap into This competitive online space whenever one's experiencing restrictions at the moment due to COVID YouTube ad revenue also jumped nearly 50 percent as well on the back of that 6.9 billion Against expectations of 6.2 billion. So that's your kind of earnings summary a quick look elsewhere He's back. Yeah Mario Draghi super Mario back in the hot sea We've talked about this a lot in my notes on Sunday in our briefing on Monday So it's not the most unexpected news But yeah, Italy's president has asked Mario Draghi the former ECB president to come back and begin talks to form Or look to form a new Italian government overall take here is that You know the guy has a nickname of super Mario for for one clear reason He's you know, he used to throw everything in the kitchen sink during the sovereign crisis And when he was steering the ship at the ECB He is an extremely smooth operator Incredibly well experienced. He's very well respected in markets. He is a very safe pair of hands Particularly in a situation as unstable as the Italian political environment at the moment so A technocrat government could well be the solution that's needed really given the disharmony and the The kind of split and fragmentation of Italian politics at the moment However, it's definitely not going to be absolutely plain sailing because there is a few things here The senior politician in Italy's five-star movement has said already that they would not support a Draghi led government and some of the things I was reading this morning in the politico We're suggesting then that that's difficult because then he needs to create numbers from somewhere And that might either come from either The PD or the Forza Italia So he's got to look to bring in some of these other parties Which could then bring a degree of apprehension amongst the existing other coalition members Who might not want to participate in a government sharing power in such a way So yeah, definitely to keep an eye on I'll be interested to see. Well, actually, let's have a look at btps I mean look at the reaction in btps this morning who Big big pop gap up in btps italian bond futures here So you can see yield's just sinking on the back of draghi being more formally tipped now as potentially the next italian p.m If you can club together this government So the idea here being then is that this is the market saying that, you know, they would love draghi to bring a little bit of an adult in the room restore a bit of calmness and an order into the italian system at the moment and what otherwise has been a degree of political instability Okay elsewhere Just want to have a quick word on this Oxford astra study um, you know another good news actually for the uk. I mean the uk is done. They are pretty A phenomenal job, of course of getting up and running and you know, they were administering almost 600 000 doses in one day just a few days ago So they continue to close in on this mid-feb target I must say that it doesn't mean though that they're going to loosen restrictions at that point in time You know lots of conversation at the moment About new variants on the variants if you like whether it be in uk or elsewhere And so, you know the virus is mutating as viruses do and this does pose then considerable risk risk Then to a new transmission of the virus and also then the the effectiveness of the vaccines in themselves So definitely it's not just about hitting target in this game over this thing is going to be very Long and protracted in my view in terms of the reopening of any of these economies from fairly stringent lockdowns But the vaccine update here that's positive is a single dose of the oxford astra coronavirus vaccine Is 75 effective from three weeks to 12 weeks after the injection According to analysis of trial data and in the vaccine efficacy rose to 82.4 Following a second dose administered then at the 12 week marker So this is very important because the uk remember a few weeks ago took the strategy approach rather than just administering dose one Come back those two move on next person, please What they've gone down to was the efficacy rate is strong enough Um to bias time to administer as many people as possible In a 12 up to 12 week period and then we'll start administering the second shots And this data would suggest them that that was a very good decision that the uk government has made And in order to then ramp up and get as many people inoculated as possible Which is going to be obviously very productive in trying to contain the virus and its transmission at this point Otherwise elsewhere wti crude obviously moved to a one-year high yesterday We briefly had to the chart there's some really interesting levels on the outside Which could open a bit of a door to to a further push Particularly under this type of Maxime news equities, you know nasdaq's just a whisk off session high or all-time highs again The s&p's fully recovered last wednesday sell-off on that Kind of reported liquidation of some of the hedge fund positions in these short squeeze stocks That's that ship has sailed if you like Gme game stop they would they got hammered again yesterday All of those companies pretty much getting getting crushed And silver's backed off more than closed the gap and we're trading down below 27 In silver futures this morning. So that that ship has sailed now as far as markets are concerned But in terms of the api's last night headed the dearies later A bullish figure which is only going to help the kind of oil picture at the moment with the technical moves above what we saw Yesterday meaningful levels on the longer term Charts the headline draw was 4.261 million More than double consensus Cushing draw 1.885 gasoline draw 240,000. So we'll be looking at those numbers as reference points for later on today Then as far as the the session is concerned, we've had some Chinese data overnight. Is it really That important to be honest or be at their service PMI at 52 against expectations of 55.5 Which was the lowest in april of 2020, but nonetheless the markets just not not that focused on Those figures at the moment and obviously still above the key expansionary level of 50 for the time being You've got the service PMI is coming out this morning. These are all final readings. So unlike to be market moving But what will be of interest is the hi cp flash Readings inflation figures coming out of the eurozone at 10 o'clock worth watching if you're looking at things like the euro currency Then this afternoon ism Services PMI you've got ADP national employment as well. So You know somebody's jobs related figures or constituents in ism will be key as to then form our idea of what the Labour report will look like from the u.s. government department on friday in non-farms do ease 330 And speaker wise you've got a lot of fed speakers actually today But they don't really kick off until u.s. Trading hours with 130 feds kashkari You've got bulad harker mester evans, but between kashkari And mester you've pretty much got the absolute full spectrum of f mc Perspective from dovish Hush kari to hawkish mester. So they'll be interested to see what they've got to say I must stress though that only one These five fed speakers are voters and that being feds evans Who's the last one up on the docket and doesn't speak until aftermarket just a point of note earnings wise today What have we got well from the u.s pre-market a couple of interesting smaller names perhaps on a single stock basis spotify Biogen aftermarket qualcomm ebay But no one i'd say impactful from an index trading perspective. All right, that is it. Good. Let you get on with the day Any questions at all feel free to drop me a comment and happy to help. All right. Thanks guys. Have a good day