Trading frenzy

Today’s news headlines:

‘US stock futures drop as Robinhood seeks to restore GameStop trading’. This week, a Retail-investor-led rally in Gamestop shares resulted in trading restrictions being imposed on excessive bid shares by free-to-trade platforms. Overnight, online brokerage Robinhood had to draw upon almost $1bn in bank lines, in order to maintain sufficient collateral to clear investor trades. It intends to lift trading restrictions on Gamestop shares today, with hopes that the frenzy doesn’t continue. (Financial Times)

‘Chinese warplanes simulated attacking US carrier near Taiwan’. In another sign that a change of US President won’t immediately resolve US/China tensions, the People’s Liberation Army simulated an attack on US carrier USS Theodore Roosevelt, which was patrolling the Taiwanese Air Defence Zone on 23rd January. However, most military strategists believe China will not risk open engagement with the US, despite an increase in tensions over the past four years.

Today's events, rates, and data 

  • The equity rally seems to be taking a pause, as institutional investors try to readjust to the emerging influence of retail investors. The EU is taking a more heavy-handed approach to securing coronavirus vaccines for domestic use, including the prospect of seizing supplies. The Dollar is appreciating a touch this morning, which has caused Sterling, Euro and the Yen to tick lower. There is little meaningful data out today, meaning focus is likely to remain on the aftermath of the retail equity blitz.

Today's events

AU PPI q/q: 0.5% vs 0.4% last month
AU Private Sector Credit m/m: 0.3% vs 0.1% last month
JP House Starts y/y: -9.0% vs -3.7% last month
JP Consumer Confidence: 29.6 vs 31.8 last month
EU French Consumer Spending m/m: 23.% vs -18% last month
CH KOF Economic Barometer: 96.5 vs 104.1 last month
EU German Unemployment Change: 8:55am
EU German Prelim GDP q/q: 9:00am
CA GDP m/m: 1:30pm
US Chicago PMI: 2:45pm
US Pending Home Sales m/m: 3:00pm

Interbank rates

GBP/USD: 1.3660
GBP/EUR: 1.1290
EUR/USD: 1.2095
USD/CAD: 1.2840