🔑Markets Focus= Fed Tapering?

It was finally a green day for stock indices as they climbed after the Evergrande saga cooled (of course, we will need to observe whether they made today’s coupon payment too) and the Fed’s speak.

Essentially, the Fed officials generally signal a go-ahead to taper soon, and that interest rate could start to rise higher than what market participants generally anticipated. This is good news for Pika World since we have been accumulating some financials as a hedge. Moreover, our expectation of tapering in December is in line with yesterday’s conference call.

Hence, if economic progress continues to bode well in the coming months, we could see the reduction of the $120B monthly asset purchase to pare down over time.

💸SoFi: A Gem in the Eyes of Beholders

The stock rocketed as Jefferies analysts initiated coverage on the online lender, and it was a BUY rating. The commentary suggests more growth ahead in the area of user growth and margin expansion.

Despite being a SPAC stock, Pika World continued to be bullish on the counter since we expect its losses to decline over time gradually. In addition, its recent acquisition of Galileo Financial, a payment platform, is also a wise move as it moves deeper into the fintech space.

⏳Evergrande’s Deal a Deal Breaker?

While we have sent out an alert this morning over a negotiated interest payment on the bond by one of its onshore units, the terms are unclear. It did not state the interest paid, although we know it is roughly $35.9 million. The PBOC has further eased the banking system through the infusion of $120 billion to cushion the impact of stiff lending across financial institutions.

Today, the offshore dollar bond interest payment is due, and investors will tread carefully on the progress.

🎥Disney: Losing its Shine**

The company has been spending more to improve its content release for streaming coupled with other distribution channels and, of course, an upgrade to the Disney theme park. Yet Covid seems to play a tough ball as it announced potential delay in some TV production.

There is also suspension of the Indian Premier League season which means less sports content. Also, the Star+ launch in Latin America appears slower, which signals a potential weaker addition of international subscribers. This tends to raise eyebrows for investors.

📮What’s on the Menu Today?

At 8.30 pm, we will receive the initial Jobless Claims, which we expect to remains stable at 320K.

9.45 pm is the release of the Manufacturing PMI of 61.5, somewhat similar to the prior period of 61.1. Service PMI will also be out simultaneously, and we expect a reasonably identical level at 55.0 compared to the prior period.

It is 23 September, Thursday, at 7.25 am in Singapore and 7.25 pm in New York. We continue to monitor the market closely for volatility as we move towards the end of the week. Pika World wishes all a safe journey!