Markets Getting Defensive as Storm is Brewing

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STATE OF THE MARKETS

Optimism retreats further and safe-havens in demand. Equities took another dip as investors cashed out at the height of the markets, with Dow fell more than 300 points (-1.16%) followed by Nasdaq at 97 points (-0.82%) and S&P for 41 points (-1.16%). Energy, utilities and real estates suffers as rising covid cases prompts local governments to reimpose lockdowns. Nevertheless, vaccine news calm the jitters with Pfizer reassuring delivery before Christmas. 

IT and consumers continue to thrive under current climate with crude closed higher around $41.70. Gold inched lower to close below $1,880/oz and the 10Y benchmark inched higher around 0.87%, which saw more than $394m and $138b flows into the precious metal and US treasury futures respectively on the falling prices.

The greenback continued to be bought on the short-term while firmly supported by the CAD and CHF on the medium and long term. Sterling took a dip as early investors took profit but remained supported in the medium and long term on the prospect of a resolved Brexit next week.

 


G8 CURRENCIES SENTIMENTS

ST NZD JPY CAD USD AUD CHF GBP EUR ST
MT JPY EUR CHF NZD AUD GBP USD CAD MT
LT NZD AUD GBP JPY CAD EUR USD CHF LT
** ST refers to Short-Term which is daily turnover, MT is Medium Term which is 
weekly
and LT refers to Long-Term which is monthly turnover.

WALL ST MOST ACTIVE

TICKER LAST PRICE

% CHANGE

VOLUME 90 DAYS AVG
NIO 45.06 -3.28 271,678.3K 137,136.1K
FCEL 5.10 +23.79 231,333.7K 19,209.5K
DNK 4.57 +90.42 170,990.8K 932.0K
GE 9.73 +0.52 148,865.8K 99,839.4K
AAL 12.74 +0.32 99,888.5K 66,213.7K
PLTR 17.90 +0.28 89,957.9K 49,545.2K
TSLA 486.64 +10.20 78,044.0K 61,814.6K
F 8.82 +0.80 77,759.3K 64,302.6K
AAPL 118.03 -1.14 76,322.1K 158,414.5K
NCLH 20.46 -7.25 71,591.7K 30,240.8K
** % Change here refer to price vs previous day price

WALL ST TOP FLOWS

TICKER LAST PRICE

VOLUME

% CHANGE FUNDS FLOW $
TSLA 486.64 78,044.0K +140.40 37,979.3M
BA 203.30 65,990.6K +177.74 13,415.9M
NIO 45.06 271,678.3K +17.06 12,241.8M
AMZN 3,105.46 2,916.8K -44.09 9,058.0M
AAPL 118.03 76,322.1K -33.94 9,008.3M
BABA 255.83 28,307.1K +11.94 7,241.8M
NVDA 537.15 12,773.1K +36.38 6,861.1M
MSFT 211.08 28,372.7K -10.25 5,988.9M
ZM 415.04 10,974.2K +8.15 4,554.7M
FB 271.97 12,152.9K -42.87 3,305.2M
** % change here refers to volume vs. 20 days average volume.

TOP 5 BLOCK ORDERS

TICKER PRICE/STRIKE TYPE VOL/OI FUNDS FLOW
BYND 134.01/155.00 stock options/put 65.27 975.6M
TSLA 486.64/475.00 stock options/put 62.80 37,979.3M
CL 42.15 – 42.40 crude oil futures 2,200 92.8M
GC 1,874.00-1,882.50 gold futures 2,100 394.3M
ZN 138.1400 – 138.1450 US bond futures 10,000 138,142.5M

OUR PICK – KraftHeinz (KHC, Nasdaq)

It’s time to load on defensive stocks. With market storms brewing in uncertainties, it’s time to rotate to defensive undervalued stocks and we picked KraftHeinz on the merit of dividend payout, PEG and institutional interests. With dividend yield around 5%, it’s quite a steal compared to market median of 2.8% and at $31.63 as of yesterday close, it’s 40% below its enterprise value if a white knight were to take over. Technically, as long as $30.89 remains pivot, we are looking for an upside to $32.60 and $33.15 but shall price remain suppressed below $32.60, there is a chance for a dip to $29.00 and $28.10. As of last quarter, Bank of Nova Scotia, DZ Bank and GoldmanSachs were seen to divest their holdings while hedge funds Bridgewater, Renaissance Tech and Natixis bank have increased their holdings.

HORIZON STRATEGY SL TP1 TP2
Short-Term Buy 30.40 32.60 33.15
Medium-Term Buy 30.40 33.15 34.55
Long-Term Flat

 

Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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