Buys and Buys Long-Term Weekly Digest | Jan 10, 2021
Buys and Buys Long-Term Weekly Digest
Markets cheer Biden and Democrat Senate victories in Georgia.
Sunday, January 10
Portfolio Update Week of January 8
- Do we have gridlock or not!
- In terms of overall percentage, it is about as close to 50/50 as it's ever been; however, the Democrats control all three branches by narrow margins.
- If Friday closes flat to up, we will have completed a positive return in the equity markets for this week. As goes the first week, goes the year an age-old adage many old timers believe.
- Positive drivers seem to be an enormous amount of capital on the sidelines that has been emboldened by the Biden victory, coming out after 4 years of hibernation. Equally as impactful are the positive fundamentals for Q4 EPS reports, which will likely follow up with the upward momentum established in Q3 2020 as companies are proving to be very adaptive to the Covid environment and will benefit from many of the technological implementations and efficiencies moved forward as revenues and EPS will continue to increase.
- Regarding the Biden economic plan and expected tax hike, we will have to wait until there are very solid signs of an economic recovery at hand.
- Meanwhile, continued economic stimulus both fiscal and monetary are continuing to support the economy. It is estimated that another two to three trillion dollars may be injected into the economy in the front half of the year to grease the economic gears.
- The market rally has been extremely broad and somewhat lumpy this week led by small caps as tech and NASDAQ sold off followed by economic sensitive cyclicals and energy. Then, a post-Georgia Democratic sweep lifted the tech sector.
- The biggest consistent winner has been Bitcoin, as investors are anticipating more printing of fiat currencies to bolster global economies. Strategists and pundits alike are projecting Bitcoin to equal the market cap of gold which would ultimately equate to another eightfold increase, resulting in an upside target of $400,000 per Bitcoin.
- Roku (ROKU) has started the year off strong, jumping nearly 10% on a brokerage firm’s upgrade to $400 per share. Voyager digital (VYGVF) has increased over 100% in a month due to the explosion in Bitcoin valuations. eSports (GMBL), a perceived beneficiary of New York State's move towards legalized gambling, jumped over 15%. Magnite (MGNI) led to the downside selling off over 20%, reeling from a short seller's research report.
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