Here are five things you need to know for Monday, February 1st:
1. – Futures futures contracts rise as Reddit Crowd turns to precious metals
Equity futures were higher on Monday as fears of volatile retail, especially in GameStop shares (GME) – Get report and AMC Entertainment (AMC) – Get report, decreased when day traders focused their attention on precious metals.
Contracts linked to the Dow Jones Industrial Average rose 236 points, S&P 500 futures rose 37 points and Nasdaq futures rose 129 points.
Silver became the new target for retail investors over the weekend, with futures up to as high as 13%.
Shares rose lower on Friday amid the ongoing retail frenzy on Wall Street and concerns about the spread of coronavirus vaccines. The S&P 500 achieved its biggest weekly decline since October.
The Dow and the S&P 500 each lost 3.3% last week, and the Nasdaq fell 3.5%.
On the stimulus front, ten Republican senators have proposed a $ 600 billion coronavirus relief plan, an alternative to the Biden administration’s $ 1.9 billion package.
2. – Silver is a new target for retail investors
Silver prices rose on Monday as Reddit mania spread around heavy shortfall to the metal market.
Spot silver traded up 9.76% to $ 29.64 an ounce early Monday. The futures market rose to 13% over the weekend, with silver crossing $ 30 per ounce for the first time since 2013.
Popular on Twitter: “#silversqueeze.”
People on the WallStreetBets Reddit forum beat silver and the iShares Silver Trust ETF (SLV) – Get report, with traders seeing it as a way to hurt big banks, which they say artificially suppress prices.
BlackRock’s (BLK) – Get report According to Bloomberg, iShares Silver Trust, the largest exchange-traded product that follows the metal, has a net inflow of $ 944 million.
The room for short-term pressure in silver is less obvious, as money managers have held a net long position on silver since mid-2019, Bloomberg reported, citing futures and options from the Commodity Futures Trading Commission.
“The events of last week have shown that it is unwise to question the purchasing power of retail investors, and this is again sufficient evidence in the silver market,” said Howie Lee, an economist at OCBC Bank. “They may find it a little harder to test the silver market than with GameStop – the former is much larger and more liquid – but the momentum seems to be resting on them right now.”
3. – Robinhood reduces the limited trading list to eight shares
Robinhood, the online trading app, has reduced the number of businesses on which it has set trading limits to eight out of 50.
Opening new positions in GameStop, AMC Entertainment, BlackBerry (BB) – Get report, Print out (EXPR) – Get report, Genius Brands (GNUS) – Get report, Koss Corp. (KOSS) – Get report, Naked brand (NAKD) – Get report and Nokia (NOK) – Get report on Monday will be limited, Robinhood said on its website.
GameStop fell 7.96% in pre-trading to $ 299.13 on Monday. The share has risen 1,643% so far in 2021.
Robinhood said last week that it had to limit trading in 50 shares due to the large costs involved in completing the large number of transactions.
“It was not because we wanted to stop people from buying these shares,” Robinhood said.
The trading app came under fire last week after trade restrictions were imposed, coupled with restrictions imposed by online brokers, a scream among social media groups and elected officials claiming they were an attempt by Wall Street to to protect themselves from newly empowered populist investors.
4. – This Week’s Calendar: Amazon and Alphabet Earnings, US Job Report
Earnings reports expected from Warner Music Group on Monday (WMG) – Get report, Cirrus Logic (CRUS) – Get report, ON Semiconductor (ON) – Get report, Thermo Fisher Scientific (TMO) – Get report and NXP Semiconductors (NXPI) – Get report.
Reports expected from Amazon later this week (AMZN) – Get report, Alphabet (GOOGL) – Get report, Alibaba (BABY) – Get report, United Package Service (UPS) – Get report, Pfizer (PFE) – Get report, Chipotle (CMG) – Get report, Amgen (AMGN) – Get report, Exxon Mobile (XOM) – Get report, AbbVie (ABBV) – Get report, PayPal (PYPL) – Get report, Electronic Arts (EA) – Get report, Spotify (Spot) – Get report, Merck (MRK) – Get report, Penn National Gaming (PENN) – Get report, Snap (SNAP) – Get report, Ford (F) – Get report, Pinterest (PINS) – Get report and Activision Blizzard (ATVI) – Get report.
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The U.S. economic calendar on Monday includes the PMI of Markit Manufacturing (final) for January at 9.45am ET and the ISM Manufacturing Index for January at 10am, and construction spending for December at 10am.
Economic reports expected later this week include the official U.S. Nonfarm Payroll Report for January, durable goods orders and factory orders.
5. – Exxon and Chevron reportedly discussed a merger last year
The top executives at Exxon Mobil and Chevron (CVX) – Get report discussed the merger of the two oil companies last year after the coronavirus pandemic halted demand for oil and gas, reports The Wall Street Journal.
The people familiar with the talks told the Journal that the discussions were described as preliminary and not ongoing.
A merger of the energy giants will create a business with a market value of more than $ 350 billion. Together, they would form the world’s second largest oil company based on market capitalization and production and produce about 7 million barrels of oil and gas per day based on the pre-pandemic, the Journal noted.
Saudi Aramco is number 1 in both measures.