Wall Street Today: Investors don’t see end to record-breaking equity rally yet

Moomoo Recap US joined discussion · Jul 4, 2021 19:15

Wall Street Today: Investors don’t see end to record-breaking equity rally yet

Investors don’t see end to record-breaking equity rally just yet

As stocks around the world continue to smash one record after another, some of the world’s biggest money managers have a simple message: Get used to it.

The likes of BlackRock Inc., State Street Global Markets, UBS Asset Management and JPMorgan Asset Management expect equity markets to keep rising in the second half of the year, with many investors increasingly looking outside the U.S. for more returns.

While some market players caution about risks of a dip given punchy valuations, the sharp bounce in corporate earnings and strong central bank support are expected to keep the rally alive.

It’s the beginning of the end of easy money

Central banks are starting to tip-toe away from the emergency stimulus they deployed to fight the pandemic-driven global recession.

Federal Reserve Chair Jerome Powell and colleagues have begun debating when and how to slow their asset-purchase program, while the People’s Bank of China is already curbing credit growth. Brazil, Mexico, Turkey, the Czech Republic and Russia have hiked interest rates and others are starting to publicly detail how they may pull back support.

U.S.-stock funds are up 16% for the year as cash flows in

Mutual-fund investors aren’t giddy, but they continue to buy in.

As the stock market hit records in the second quarter that just ended, investors sent their cash to both stock and bond funds.

Investors put a net $10.0 billion into U.S.-stock mutual funds and exchange-traded funds, and $56.7
billion into international-stock funds, based on Investment Company Institute estimates. As often happens,
they invested much more—a net $161.8 billion—in bond funds,
partly to protect themselves for the day when the bull market falters.

Fed could be a surprise catalyst for the markets in holiday week

The Fourth of July holiday week looks like a sleeper for stocks, with little data and quiet pre-earnings season trading.

But the Fed releases the minutes from its last meeting where it revealed it was starting to talk about cutting back on its bond buying. If there are more details, it could move markets.

Stocks gained in the past week, and the S&P 500 and Nasdaq hit new record highs after Friday’s employment report showed 850,000 payrolls were added in June.

Richard Branson believes the space market has room for 20 companies launching tourists

Sir Richard Branson believes there is plenty of opportunity in the market for companies like $Virgin Galactic(SPCE.US)$, Jeff Bezos’ Blue Origin, or Elon Musk’s SpaceX.

“There’s room for 20 space companies to take people up there,” Branson told CNBC.

The companies of Branson, Bezos, and Musk are each flying spacecraft that can carry passengers, but in different ways, as the former two fly to the edge of space while the latter goes further, into orbit.

What will investors learn from the Fed’s minutes?

Investors left scrambling after officials at the Federal Reserve convened to discuss monetary policy last month will gain more clarity on Wednesday when minutes from that meeting are released.

The US central bank surprised market participants in mid-June when it signalled a potential policy shift in the face of and strong growth.

ByteDance starts selling TikTok’s AI to other companies

ByteDance is selling some of the artificial-intelligence technology that powers its viral video app TikTok to websites and apps outside China, as it broadens its revenue streams ahead of a long-anticipated initial public offering.

A new division called BytePlus quietly launched in June and already lists customers all over the world, including in the US.

According to its website, early customers include Goat, the US-based fashion app; WeGo, a travel booking site in Singapore; and Chilibeli, an Indonesian online shopping start-up. TikTok is also listed among its customers.