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BITCOIN OR REFLATION TRADE? (0737 GMT)
The storming of the Capitol exposed to the world how divided
the U.S. society is and depending on whether one believes the
country can be healed, comes different investment conclusions,
writes Rabobank strategist Michael Every this morning.
"Either buy into the reflation trade on the presumption that
the new administration will at least attempt to use economic
stimulus to bridge the political divide; or expect the worse and
just buy Bitcoin", he argues in a somewhat provocative morning
note.
So far in 2021, both options, reflation and cryptomania,
seem to be walking hand and hand amid the bulls.
Bitcoin has reached a record $40,000 overnight and the U.S.
10 year Treasury yield has shot above 1.08%, to its highest
since the COVID-19 crash in March.
So far this year, as you can see below, both are doing quite
well:
(Julien Ponthus)
*****
EUROPE SHINES IN 2021'S FIRST WEEK OF TRADING (0636 GMT)
European shares are seen opening well into positive
territory this morning and set to outperform their U.S. rivals
for the first week of trading of 2021.
The pan-European STOXX 600 is currently on course for weekly
gains of about 2.4% versus 1.3% for the S&P 500.
It must be said however that the latter is enjoying fresh
record highs while Europe has still some way to go to reclaim
the highs last touched in February 2020.
Talking about new records, Asian stocks have rose to new
highs overnight with Japan's Nikkei hitting a three-decade peak.
Despite the coronavirus pandemic and the U.S. political
crisis, investors are still betting that 2021 will be a year of
economic rebound.
(Julien Ponthus)
*****