For immediate release
Chicago, IL – November 30, 2021 – Zacks.com announces the list of stocks featured on the Analysts Blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Recent actions featured in the blog include: The Home Depot, Inc. HD, JD.com, Inc. JD, and EssilorLuxottica Société Anonyme ESLOY.
Here are highlights from Monday’s analyst blog:
Will Bond Tapering accelerate? Socket? Coming World Week
As the coming global week dawns, new COVID fears – fueled by a new South African variant – have ravaged risky markets.
Equity (and oil) traders are now heading towards the end of the year.
Macroeconomic data published in Global Week Ahead could provide the spark: a spark that reignites risk-free U.S. Treasury bond market rates, regardless of this new variant of COVID.
Something like a combination of:
– European consumer price inflation higher than forecast. It came out on Tuesday.
– An impression of non-farm jobs in the United States for November. It came out on Friday.
What if both macro impressions hit a high note?
It can provide fodder. To those who argue that the big US banks and the European Central Bank (ECB) must hurry and unwind their extraordinary incentive to buy bonds.
Next are Reuters’ five global market themes, revamped for equity traders.
(1) Renewed COVID fears of bringing back the monetary policy doves?
COVID-19 fears and inflation data weigh heavily on policymakers, who must decide the fate of two ECB bond buying programs in just three weeks.
Tuesday brings flash inflation for the euro zone in November. October’s impression was 4.1% and many see it staying above the ECB’s 2% target next year. German, Spanish and French CPI data are released on Monday and Tuesday.
As inflation rises, the ECB’s hawks warn against keeping monetary policy too loose for too long. A new German government, meanwhile, could raise the minimum wage by around 25%.
Their message resonated with nervous markets. But the resurgence of COVID is strengthening ECB doves as Europe battles a new wave, and news of a new variant of the virus spreading from South Africa is raising alarm bells.
Renewed economic uncertainty means investors are again lowering rate hike bets for the US, Eurozone and Britain. Doves, it seems, have new ammunition to repel those who call for a quick end to the stimulus.
(2) US Nonfarm Payrolls for Friday in November
With the Federal Reserve’s slowdown underway, a strong jobs report in November could strengthen the arguments of those who argue that its $ 120 billion-per-month bond purchases should unwind faster.
As the Fed expects the unwinding to be complete in mid-2022, robust economic growth and inflation exceeding double the flexible average target of 2% have prompted bets on a faster unwinding and higher rate hikes. early.
Wage expectations were boosted by weekly data showing jobless claims at their lowest since 1969. Employers are expected to have created 563,000 jobs, and any higher figure could reignite recent bond market turmoil and mean another leg over high for the dollar.
(3) OPEC + meets Wednesday, Thursday
The OPEC + oil producer group has held on to monthly production increases of 400,000 barrels per day (bpd) since August, defying calls from consuming countries for more oil to cool prices by more than $ 80. Its meeting from December 1 to 2 will come just after the American decision to release 50 million barrels of oil from strategic reserves.
The prospect of an oil surplus has not faxed the oil markets; Goldman Sachs called it “a drop in the ocean”. Still, an OPEC + source said the release of oil by the United States and several other countries, while smaller than expected, would complicate its calculations.
OPEC + production cuts will amount to 3.8 million bpd by the end of December, or around 4% of global consumption. Sources say there are no discussions yet on how to respond to the U.S. decision to suspend production increases. But the group warned that the move could cause an oil glut next year.
(4) Will there be signs of further credit growth in China?
The growth in new mortgages underlies hopes that the bottom may be for Chinese credit and that the economic drag from a dreaded real estate disaster will begin to wear off.
There are signs of a shift towards policy easing. While benchmark rates have not changed, banks are encouraged to lend to developers, authorities seek to lower costs of financing small businesses, and have moved on to strengthen yuan stability.
Tuesday’s purchasing manager indices could show if the tide is turning. But keep an eye out for the Chinese port city of Dalian, where COVID is on the rise.
(5) Is the Turkish Lira getting out of hand?
Turkey has just reminded (another) that prudent monetary policy is important, especially in emerging markets in times of high inflation.
President Tayyip Erdogan has doubled down on his view that double-digit inflation can be brought under control by cutting interest rates. The pound responded with a 15% drop on Tuesday, which left it in uncharted waters.
The currency has partially recovered, but the central bank could proceed with another rate cut at its December 16 meeting.
Monetary policy concerns are also mounting in Mexico. The peso took a hit after the president unexpectedly dropped his candidate for central bank governor, appointing a deputy finance minister instead.
A strengthening dollar, rising inflation and a Fed in slapstick mode leave emerging market central banks with a lot of room for error.
(1 euro = 14.0991 lire)
Zacks # 1 Top Stocks (Strong Buy)
Look at Zacks’ metrics linked to a large retailer in the US, China, and Europe.
(1) Home Depot: It is a stock of $ 404, which represents a market cap of $ 430 billion. I see a Zacks Value score of F, a Zacks Growth score of D, and a Zacks Momentum score of B.
(2) JD.com: It is a stock of $ 87, which represents a market cap of $ 119.7 billion. I see a Zacks Value score of D, a Zacks Growth score of C, and a Zacks Momentum score of A.
(3) EssilorLuxottica: It is a stock of $ 101, which represents a market cap of $ 93.4 billion. I see a Zacks Value score of D, a Zacks Growth score of D, and a Zacks Momentum score of D.
None of the metrics look very good, do they? I’m just saying.
Zacks’ value and growth scores are low, overall.
Zacks investment research
800-767-3771 ext 9339
Past performance is no guarantee of future results. The potential for loss is inherent in any investment. This material is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether an investment is suitable for a particular investor. It should not be assumed that any investment in any identified and described securities, companies, sectors or markets was or will be profitable. All information is current as of the date hereof and is subject to change without notice. The views or opinions expressed may not reflect those of the company as a whole. Zacks Investment Research does not engage in investment banking, market making or securities asset management activities. These returns come from hypothetical portfolios composed of stocks with a Zacks rank = 1 that have been rebalanced monthly without any transaction costs. These are not the returns of actual equity portfolios. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for more information on the performance numbers displayed in this press release.
Technological IPOs with huge profit potential: Last year, major IPOs jumped 299% in the first two months. With record amounts of cash flowing in IPOs and a record stock market, this year could be even more lucrative.
View Zacks Hottest Tech IPOs Now >>
Click to get this free report
The Home Depot, Inc. (HD): Free Stock Analysis Report
EssilorLuxottica Non-sponsored ADR (ESLOY): free stock analysis report
JD.com, Inc. (JD): Free Stock Analysis Report
To read this article on Zacks.com, click here.
Zacks investment research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.