4 Chip Stocks That Can Rise Even More in 2021

The world’s growing appetite for 5G phones and other high-performance technology will mean more demand for semiconductors, according to Wells Fargo.

Dow Jones Futures: Stock Market Rally Awaits Stimulus Deal Vote; Three Dow Giants Set To Jump

A stimulus deal vote could come Sunday, with Nike, Goldman and JPMorgan set to jump on news. The Moderna vaccine is being shipped. Tesla joins the S&P 500.

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Trump Signs Bill That Could Lead To Delisting Of Chinese Stocks Including Nio, Li, Xpeng, Alibaba

U.S. President Donald Trump has signed a bill calling for the delisting of foreign companies that don't adhere to the same accounting transparency standards that securities regulators impose on public U.S. firms.Why It Matters: The Holding Foreign Companies Accountable Act takes aim at Chinese companies and drew rare strong bipartisan support in the U.S. Congress before arriving on Trump's desk.The act says delisting could happen if a given company doesn't comply with audit inspections three years in a row.China's government does not allow the board to perform audit inspections of Chinese companies listed in the US. Audit inspections are performed on other U.S.-listed companies by the Public Company Accounting Oversight Board, set up after accounting scandals such as the one that blew up Enron in the early 2000s.Chinese companies listed in the U.S. have been embroiled in financial scandals in the past -- including Luckin Coffee Inc - ADR (OTC: LKNCY) this year, which led to a Nasdaq delisting.Sixteen Chinese companies have delisted since February 2019, according to a government report in October.Carson Block, who has made himself a short-selling star through his investigations into Chinese companies, has called for the delisting of Chinese firms, saying to Bloomberg last month: "This is China and the Chinese stock promotion, manipulation fraud machine laughing in the face of the SEC."What's Next: Markets now await any news on specific delistings. The bill could affect 217 Chinese companies, including popular stocks such as Alibaba Group Holding Ltd - ADR (NYSE: BABA), JD.Com Inc (NASDAQ: JD), Nio Inc - ADR (NYSE: NIO), Xpeng Inc - ADR (NYSE: XPEV) and Li Auto Inc. (NASDAQ: LI).But because of the three-year compliance timeline in the act, delistings may not be imminent.The author of this article holds shares in Luckin Coffee and an inverse ETF that tracks the downward performance of Chinese companies listed in Hong Kong.Photo credit: Xpeng Motor Technology Ltd.See more from Benzinga * Click here for options trades from Benzinga * Klarna Could Follow Affirm Holdings In Delaying Anticipated 'Buy Now, Pay Later' Fintech IPO * FTSE Russell To Drop 8 Chinese Companies From Some Indices, In Response To US Blacklist(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Here Are Barron’s 10 Top Stocks for the New Year

The group offers good appreciation potential, while providing some downside protection if the stock market falters in 2021.

Bearish Bets: 2 Stocks You Really Should Consider Shorting This Week

Using technical analysis of the charts of those stocks, and, when appropriate, recent actions and grades from TheStreet's Quant Ratings, we zero in on five names. While we will not be weighing in with fundamental analysis, we hope this piece will give investors interested in stocks on the way down a good starting point to do further homework on the names. Overstock.com Inc. recently was downgraded to Sell with a D+ rating by TheStreet's Quant Ratings.

Escape from NY: Analyst warns exodus means the city won’t be a ‘billionaire playground’ anymore

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These Are The 5 Best Stocks To Buy And Watch Now

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Fed Decision Could Bring Bank Stocks Into Bull Market

Traders waiting for a better moment to get into bank stocks may have gotten one.What Happened: The U.S. Federal Reserve Board released a statement after markets closed on Friday that clears the way for major banks to restart share repurchases.The decision was part of the Fed's stress-testing of banks amid the economic uncertainty of the pandemic. The board, seeing healthy capital reserves among the banks, passed the 33 firms it tested while also allowing them to restart limited share repurchasing. Such purchases had been paused earlier in the pandemic.Why It Matters: Though they have not done poorly, bank stocks haven't benefited as much from the 2020 bull market as other some other industries.The decision could change this going into the new year, as stock repurchases add support to share prices by boosting demand.According to Bloomberg, six biggest U.S. banks could buy back as much as $11 billion of shares in the first quarter of next year.Trading Action: The Fed announcement came at 4:30 EST on Friday. The Financial Select Sector SPDR Fund (NYSE: XLF), which includes major banks JPMorgan Chase & Co. (NYSE: JPM), Bank of America Corp (NYSE: BAC), Citigroup Inc (NYSE: C), Wells Fargo & Co (NYSE: WFC), Goldman Sachs Group Inc (NYSE: GS), and Morgan Stanley (NYSE: MS) in its holdings, closed up 3% in afterhours trading from Friday's close of $28.49. Photo credit: Joe Mabel, WikimediaSee more from Benzinga * Click here for options trades from Benzinga * Klarna Could Follow Affirm Holdings In Delaying Anticipated 'Buy Now, Pay Later' Fintech IPO * Ouch. Airbnb Hosts Missed Email Offering Them Pre-IPO Shares: NPR(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Santa Claus Rally, holiday-shortened week: What to know in the week ahead

This week is set to be quiet as traders wind down for the holidays. Relatively few economic and earnings reports are set for release, and virtually all of these will be packed into the first three days of the week.

Learn a Lesson From Luckin Coffee — and Avoid It in the Process

You may remember Luckin Coffee (OTCMKTS:LKNCY) as the ticker symbol LK. That’s no longer the case. After revelations this past year, Luckin Coffee stock was relegated to the over-the-counter market.  Source: NewsToday / Shutterstock.com This was once a promising growth stock, but it led investors astray when top management was dishonest about sales, among other things. While the company looked like it was about to go from modest coffeehouse to perennial powerhouse, Luckin just couldn’t resist cooking the books.  So, rather than burning its coffee, the company burned its investors. And while it was a great growth story then and showed plenty of promise, it was also a dishonest representation of the opportunity investors are seeing in China. InvestorPlace - Stock Market News, Stock Advice & Trading Tips My point? Let Luckin Coffee stock serve as your reminder to do your due diligence.  Luckin Coffee Stock in a Nutshell Before it got caught, there was writing on the wall for Luckin Coffee stock. Specifically, Muddy Waters had published research about its questionable accounting practices. That work was published on Jan. 31. 

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The report came just a few weeks after Luckin hit an all-time high and the news sent a jolt of volatility into the share price. Shares fell as much as 27% in a single day. However, Luckin was able to recover some of those losses, ending lower by “just” 10.7% on the day.  Then on Feb. 3, the company denied the report, buying investors some time to assess the news.  However, the truth always catches up. On Apr. 2, shares plunged as low as 81% after the company said it had accounting irregularities regarding its revenue. Days later, it was halted for more than a month.  The worst part about all of this? Not only did the company defraud investors, but it hadn’t even been public for a year at that point. It’s stint on the public market was impressive and had bulls looking for a long-term home run. Instead, they were beaned in the batter’s box and rather than trotting to first, they were ruled out.  What can we take out of this?

Well, I’d love to sit here and say every investor should do their forensic due diligence. However, the reality is that many won’t because it’s too hard or takes up too much time. Heck, look at how many pros missed this one.  But where there’s smoke, there’s fire. Bulls had a few months to bail out on Luckin once the reports were published. Many didn’t. So, while not every published short report equates to fraud, I’m suggesting we look at even our favorite stocks with an open mind.  Now What? Click to EnlargeSource: Chart courtesy of StockCharts.com Now traded on OTCMKTS, shares in Luckin Coffee stock were up 79% as of Dec. 16 from the August low. Then on Dec. 17, shares rocketed higher by almost 100% on the day. Today, the stock is even higher at $10.24. So, is that a sign to jump in? No — it’s time to move on. Whether you were burned by this name or not, investors should part ways with the coffee company.  Why? Because once a stock is relegated to the pink sheets, there’s a very good reason that it’s there. So, while Luckin may further recover, it’s too tainted to buy. Don’t get sucked into a low-liquidity over-the-counter asset by trying to catch this falling knife.  Instead, just take Luckin as a lesson learned to do better due diligence, no matter how bullish or bearish the market is on a particular security.  Moreover, there’s something else to keep in mind with this stock. The news with Luckin dealt a blow to the reputation of Chinese stocks and that’s not fair. Luckin was the first Chinese stock with accounting issues and it won’t be the last. But as investors, we can’t paint the entire group of Chinese stocks with the same brush. So, while the Luckin situation reminds us to be wary, it also doesn’t discredit the many Chinese businesses that are absolutely crushing it. Remember, China has a population of 1.4 billion. Its economic growth also outpaces most of the developed world, while its middle class is larger than the entire U.S. population.  There is opportunity in China. Just no longer with Luckin Coffee stock.  On the date of publication, neither Matt McCall nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.  Matthew McCall left Wall Street to actually help investors –by getting them into the world’s biggest, most revolutionary trends BEFORE anyone else. Click here to see what Matt has up his sleeve now. More From InvestorPlace

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The post Learn a Lesson From Luckin Coffee — and Avoid It in the Process appeared first on InvestorPlace.

Ray Dalio says son killed in Connecticut car accident

Billionaire hedge fund investor Ray Dalio has tweeted about the death of his 42-year-old son, killed this week in a car accident.

Will AT&T Or Verizon Stock Grow More By 2022?

Every week, Benzinga conducts a sentiment survey to find out what traders are most excited about, interested in or thinking about as they manage and build their personal portfolios.We surveyed a group of over 300 Benzinga investors on whether shares of AT&T Inc. (NYSE: T) or Verizon Communications Inc. (NYSE: VZ) stock would grow the most by 2022.AT&T Vs. Verizon Stock In 2020 wireless communication remains AT&T's largest business, contributing nearly 40% of revenue. As the second-largest U.S. wireless carrier, AT&T connects more than 100 million devices, including 63 million regular customers and 16 million prepaid customers.The consumer and entertainment segment, the company's second-largest revenue stream, includes the consumer fixed-line and DirecTV satellite television businesses, serving 20 million television and 14 million internet access customers.Meanwhile, Verizon is primarily a wireless business (70% of revenue and nearly all operating income). The company serves about 89 million regular and 4 million prepaid customers. Verizon connects another 24 million data devices, like tablets, via its nationwide network, making it the largest U.S. wireless carrier.As AT&T and Verizon are the nation's largest wireless carriers, it's expected they will be the most viable companies competing for the largest market share of 5G cellular technology in the coming years.Many respondents cited how they see Verizon leading the way in providing the most reliable 5G coverage in the near-term, and also noted the current video streaming partnership the company holds with Walt Disney Co (NYSE: DIS) and music streaming partnership with Apple Inc (NYSE: AAPL) as reasons Verizon is all the more attractive in 2021. Among the respondents, 62% told us Verizon will grow more over the next year, while 38% believe AT&T will experience greater gains by the end of 2022.This survey was conducted by Benzinga in December 2020 and included the responses of a diverse population of adults 18 or older.Opting into the survey was completely voluntary, with no incentives offered to potential respondents. The study reflects results from over 300 adults.Photo from Pixabay. See more from Benzinga * Click here for options trades from Benzinga * Will GE's Stock Reach By 2022? * Will Xpeng Or Li Auto Stock Grow More By 2022?(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Cramer Shares His Thoughts On Wells Fargo, Caterpillar And More

On CNBC's "Mad Money Lightning Round," Jim Cramer said he believes in Charlie Scharf, the CEO of Wells Fargo & Co (NYSE: WFC). (The Federal Reserve Board gave banks the greenlight to restart share buybacks after the market close Friday.)MasTec, Inc. (NYSE: MTZ) is a winner, said Cramer. He likes infrastructure plays.Caterpillar Inc. (NYSE: CAT) could go to $200, said Cramer. He likes Deere & Company (NYSE: DE) more.Cramer likes Velodyne Lidar Inc (NASDAQ: VLDR) for that crowded space.Tupperware Brands Corporation (NYSE: TUP) is too hard to own, said Cramer. If he had bought it at a lower price, he would be selling now.Cramer would hold on to Freeport-McMoRan Inc (NYSE: FCX) even though it has already doubled. See more from Benzinga * Click here for options trades from Benzinga * 'Fast Money' Picks For December 21(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Warren Buffett's 6 ways to keep your finances healthy during COVID

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Advanced Micro Devices Looks Ready to Run to $100

The last time I wrote about Advanced Micro Devices (NASDAQ:AMD) was in mid-October. At the time, I argued that the company should use AMD stock for the entire Xilinx (NASDAQ:XLNX) acquisition, which at the time was still only a possibility, and not a sure thing. 

Source: Sundry Photography / Shutterstock.com InvestorPlace - Stock Market News, Stock Advice & Trading Tips Lo and behold, Chief Executive Officer Lisa Su announced on Oct. 27 that it would acquire Xilinx for $35 billion, with shareholders getting 1.7234 shares of AMD for every Xilinx share. Post-completion, AMD shareholders will own 74% of the combined company, while Xilinx shareholders will own the rest.  The purchase price values the combined entity at $135 billion. If it closes by the end of 2021, Lisa Su will continue as CEO of the combined company. Current CEO of Xilinx Victor Peng will become president and manage the Xilinx business along with some strategic growth initiatives.  Since the announcement, AMD stock is up 23% and is trading perilously close to $100. This is the stock’s second run at $100. Can it stick this time? 

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I’ll look at both sides of the argument.  AMD Stock Is Ready to Run Forget Xilinx for a moment, and consider AMD’s business so far in fiscal 2020.  AMD reported its third-quarter results at the same time as its acquisition of Xilinx. The company’s sales grew 56% year-over-year to $2.8 billion. Sequentially, they rose by 45%. In terms of operating income, its profits grew by 141% over last year to $449 million — a 160% increase on a sequential basis.  The business is much stronger today now that it routinely generates free cash flow (FCF) each quarter. In Q3 2020, it had FCF of $265 million, up from $179 million a year ago and $152 million at the end of June’s second quarter. In the first nine months of fiscal 2020, it had FCF of $297 million, up from -$124 million a year ago. 

Over the past three fiscal years, its trailing-12-month FCF has gone from -$130 million in 2018, to $280 million in 2019, to $700 million in 2020 through the first three quarters; it’s likely to go over $1 billion once the fourth-quarter results are in.  If you use enterprise values of $18.80 billion for 2018, $53.6 billion for 2019 and $115.8 billion for today, its FCF yield actually stayed around 0.6%, despite the fact its business has dramatically strengthened over the past 33 months.  To me, that suggests despite the big run, AMD stock is not overvalued relative to previous years. It might not be cheap, but based on its historical averages, I think the positives far outweigh the averages.  And that doesn’t even take into account what Xilinx could mean to its future growth.  Assuming the deal gets done in 2021, I think Xilinx investors can expect to be holding AMD shares worth more than $82.98 a share later in 2021.   It’s Ready to Take a Breather AMD’s performance over the past five years has been so off-the-charts good — its five-year annualized total return through Dec. 15 is 110.3% — that its year-to-date total return of 111% seems almost ordinary by comparison.  Yet, as I stated in my October article, up 3,849% over the past five years, it seems logical that regression to the mean would hit AMD stock at some point. Further, like Murphy’s Law says, it will rain on AMD’s Xilinx parade at some point in 2021.  After all, the share exchange ratio pegs AMD’s share price at $82.98 a share. As I write this, Xilinx shareholders sit on 16% unrealized gains on their future AMD stock. That’s good, no? The problem is, if the two companies hit regulatory hiccups, and AMD’s share price retreats into the low $70 range where it traded as recently as early November, the deal isn’t looking nearly as attractive for Xilinx shareholders.  As InvestorPlace’s Dana Blankenhorn stated at the time of the announcement, the risks to both companies’ shareholders are real. 

“No cash is being exchanged in the AMD-Xilinx deal. It’s all stock. For the $35 billion price to hold, AMD stock must stay strong through the end of 2021, because it will take a year to get this past American and (perhaps more important) Chinese regulators,” Dana wrote on Oct. 29.  “Meanwhile, the world will turn. Intel’s numbers were down because data centers slowed their spending. Large cloud companies increasingly dominate this market. There were 541 cloud data centers at mid-year with another 176 in the pipeline.” Essentially, Dana argues that Intel (NASDAQ:INTC) will rebound in 2021 as investors realize that the company will bounce back from its downturn in the past year. I find it hard to believe that AMD stock isn’t going to face some volatility in the year ahead. Trading at more than 13 times sales, about three times its average multiple over the past five years, any bad news could put $100 on ice for a significant chunk of time in 2021.  The Bottom Line I continue to believe in Lisa Su. As long as she’s in charge, it’s an excellent long-term hold.  “As I’ve noted several times in the past couple of years, she’s one of the best CEOs in America and worth every penny of her $58.5 million in 2019 total compensation,” I wrote in October.  And the fact Su was able to use 100% stock to pay for Xilinx is another feather in her cap. Transformative in nature, shareholders will forget about the dilution five years from now.  Do I think it will stick above $100? AMD reports its Q4 2020 results at the end of January. They’re going to be rock-solid. For this reason, I think it’s got a shot to stay in triple digits for an extended period. That said, if you don’t own AMD stock and are interested in buying, you might wait until you can get some in the $80 range. It’s bound to have a slump at some point in the first half of 2021.  Long-term, I continue to like AMD.  On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article.  Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.   More From InvestorPlace

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The post Advanced Micro Devices Looks Ready to Run to $100 appeared first on InvestorPlace.

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Chip Stocks Fall On Report Microsoft Will Take Things In House

Microsoft Corp (NASDAQ: MSFT) is designing in-house processors for server computers running on the company's cloud services, a development which will reduce reliance on Intel Corporation's (NASDAQ: INTC) chip technology, according to a Bloomberg report.Several chips stocks fell on the news.Intel shares traded down 6.3% to $47.46. The stock has a 52-week high of $69.29 and a 52-week low of $43.61.Advanced Micro Devices, Inc. (NASDAQ: AMD) closed down 0.95% at $95.92 per share.Nvidia Corporation (NASDAQ: NVDA) shares traded down 0.52% to $530.88. The stock has a 52-week high of $589.07 and a 52-week low of $180.68.Xilinx, Inc. (NASDAQ: XLNX) shares traded down 1.76% to $149.19. The stock has a 52-week high of $154.12 and a 52-week low of $67.68.Micron Technology, Inc. (NASDAQ: MU) shares traded down 1.11% to $71.46. The stock has a 52-week high of $74.60 and a 52-week low of $31.13.See more from Benzinga * Click here for options trades from Benzinga * Why Tesla's Stock Is Trading Higher Today * Why DraftKings And Flutter Are Trading Lower Today(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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4 Top Stock Trades for Monday: DRI, CRWD, WGO, BB

What do you get when you combine a quadruple witching day — the simultaneous expiration of single-stock options, single-stock futures, stock-index options and stock-index futures — with Tesla’s (NASDAQ:TSLA) inclusion to the S&P 500 and continued jawboning in D.C. heading into the weekend? A bumpy trading day, which is what we had Friday. Let’s look at some top stock trades.  Top Stock Trades for Monday No. 1: Darden Restaurants Click to EnlargeSource: Chart courtesy of StockCharts.com Darden Restaurants (NYSE:DRI) is somewhat muted after reporting earnings, down about 2% on the day.  The stock continues to slowly but surely inch its way higher after a wickedly volatile Q1 and Q2. Sheesh, look at that drop!InvestorPlace - Stock Market News, Stock Advice & Trading Tips On the upside, it’s vital that DRI takes out and closes above resistance at $125. If it can do that, it could kickstart a massive breakout rally. 

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On the downside, see that DRI continues to hold the 10-week moving average and uptrend support (blue line). Below $105 could put the 50-week and 26-week moving averages in play. 

Top Stock Trades for Monday No. 2: CrowdStrike Click to EnlargeSource: Chart courtesy of StockCharts.com CrowdStrike (NASDAQ:CRWD) broke to new highs on Friday, clearing $200 for the first time.  Take notice of this stock when it pushes through prior resistance. Each time the stock has broken over a key level, it has held that level as support going forward. This week, CRWD burst off the two-times range extension and cleared last week’s high.  For bulls that are still in this name, they can turn their attention toward $215. This level serves as the 261.8% extension for two different measures.  The first measure is from the Covid-19 low in March to the prior all-time high. The other measure is from the Q3 low to the Q3 high. This doesn’t mean CRWD will hit $215, only that it’s an upside area to keep an eye on.  As for the downside, new buyers are faced with a wide risk range for the time being, unless trading on a smaller timeframe. 

Top Stock Trades for Monday No. 3: Winnebago (WGO) Click to EnlargeSource: Chart courtesy of StockCharts.com Winnebago (NYSE:WGO) is chugging higher on Friday, up more than 5% at close.  The stock is flirting with a breakout over the pre-coronavirus high from February. Above this level could put the June high in play near $72.50. 

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If the stock can’t hold above $63, then look for WGO stock to retest the 21-day moving average. Below that could send shares into the $52 to $53 area. There it finds the 50-day and 100-day moving averages, as well as the backside of prior downtrend resistance (blue line). 

Top Stock Trades for Monday No. 4: BlackBerry Click to EnlargeSource: Chart courtesy of StockCharts.com Down more than 15%, BlackBerry (NYSE:BB) is clearly having the opposite reaction to its earnings report.  In early December, shares of BlackBerry exploded higher, but if readers will recall, I highlighted the peculiar action as shares endured a huge fade from the session highs. Since then, BlackBerry had wound itself into a very tight wedge ahead of earnings.  Breaking lower, it’s not a good sign for bulls. Shares are also knifing through the 20-day moving average on Friday.   From here, see how the stock handles the gap-up low at $6.92. If it breaks this area and quickly reclaims it and the 21-day moving average, bulls will have a reversal low to trade against.  If BlackBerry shares break this area and can’t reclaim it, see if $6.50 acts as support. Below puts a potential gap-fill toward $6.20 on the table, along with a possible tag of the 50-day moving average.  On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in any of the securities mentioned in this article. Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.  More From InvestorPlace

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Benzinga's Bulls And Bears Of The Week: Comcast, DoorDash, Exxon, Moderna, Tesla And More

* Benzinga has examined the prospects for many investor favorite stocks over the past week. * The week's bullish calls included an oil supermajor and cloud stocks. * A top electric vehicle maker and a COVID-19 vaccine play were among the bearish calls.The U.S. approval of a second COVID-19 vaccine helped the big U.S. indexes end the past week marginally higher, led by an almost 3% gain in the Nasdaq. This despite word of a major cyberattack on U.S. federal agencies and some companies.Last week also saw the latest from the Federal Reserve, Bitcoin surging to new record levels and a major resignation from the outgoing administration. A big marijuana merger was announced, the iPhone maker is ramping up production as the holiday season winds down, and the FTC wants more from the social media giants.Through it all, Benzinga continued to examine the prospects for many of the stocks most popular with investors. Here are a few of this past week's most bullish and bearish posts that are worth another look.Bulls "Tesla's Big Advantage Over Legacy Automakers? Software, Says Munster" by Shivdeep Dhaliwal examines an advantage Tesla Inc (NASDAQ: TSLA) enjoys over legacy automakers that is both clear and profitable. Can the stock rise to $2,500 a share in the next three years?Aditya Raghunath's "Amazon, DocuSign, Morgan Stanley, And More -- UBS Conviction Picks For 2021" focuses on Amazon.com, Inc. (NASDAQ: AMZN), Morgan Stanley (NYSE: MS) and several other top stock picks for 2021 from a European analyst.Exxon Mobil Corporation (NYSE: XOM) is poised to benefit as oil demand recovers to pre-pandemic levels in the coming years, and shares have an attractive valuation. So says Priya Nigam's "Goldman Sachs Upgrades Exxon Mobil On Improving Oil Demand Outlook, Valuation."In "BofA Reinstates Coverage Of Cloud Stocks, Names Top Picks For 2021," Wayne Duggan discusses why Salesforce.com, Inc. (NYSE: CRM) and ServiceNow Inc (NYSE: NOW) have more room to run and are top picks in the cloud services arena for the coming year.In Jayson Derrick's "Why Comcast Is 'Ready To Breakout' In 2021," see why, as the pandemic eases, Comcast Corporation (NASDAQ: CMCSA) stock could prove to be a winner in 2021. The media and technology giant has several catalysts, and shares are undervalued, says a top analyst.For additional bullish calls of the past week, also have a look at the following: * What's On The Menu? Wells Fargo Cooks Up Some Stock Picks * Will GE's Stock Reach By 2022? * 12 Emerging Technologies To Watch In 2021Bears In Shivdeep Dhaliwal's "Tesla Fated For Similar Downfall As Tilray, Stock To Hit - Levels In 2021, Says Long-Term Bear," an expert suggests the leading electric vehicle maker's inclusion in the S&P 500 could bring its moment to a halt. How far could the stock plummet in the coming year?Shanthi Rexaline's "Moderna Analyst: COVID-19 Vaccine Value Largely Reflected In Stock" shows why a top Moderna Inc (NASDAQ: MRNA) analyst stepped to the sidelines last week. See what the analyst believes is likely to dictate the stock's movement in the short term."The 'Most Ridiculous IPO' Of 2020? Citron Hits DoorDash With Target" by Chris Katje makes the case that the valuation of DoorDash Inc (NYSE: DASH) stock following its initial public offering is not credible. It is "far from being the most dominant player in the market" points out a notorious short seller.United Airlines Holdings Inc (NASDAQ: UAL) and some of its rivals have flown too high too fast, resulting in double downgrades, according to "JPMorgan Downgrades Airlines JetBlue, Spirit, United, Recommends 'Selective Profit-Taking'" by Wayne Duggan.Be sure to check out the following additional bearish calls: * Berkshire's Charlie Munger Warns Against Market Frenzy, Expects Lower Returns In Next Decade * Should Investors Expect A Tax-Driven Stock Market Sell-Off In The Next 2 Weeks? * Why You Should Approach The Stock Market's Rally With CautionAt the time of this writing, the author had no position in the mentioned equities.Keep up with all the latest breaking news and trading ideas by following Benzinga on Twitter.Source image: Unsplash.comSee more from Benzinga * Click here for options trades from Benzinga * Barron's Picks And Pans Of The Week: Time Is Ripe To Sell NIO, XPeng, Li; And Lessons From The IPO Frenzy * Notable Insider Buys Of the Past Week: Avis Budget, Biotech IPOs And More(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Will Snap Or Pinterest Stock Grow More By 2022?

Every week, Benzinga conducts a sentiment survey to find out what traders are most excited about, interested in or thinking about as they manage and build their personal portfolios.We surveyed a group of over 200 Benzinga investors on whether shares of Snap Inc (NYSE: SNAP) or Pinterest Inc (NYSE: PINS) stock would grow the most by 2022.Snap Vs. Pins Stock Snap, which refers to itself as a camera company, has one of the most popular social networking apps, Snapchat. In the third-quarter Snapchat's daily active users grew to 249 million from 210 million the year prior, an 18% increase.Snap generates nearly all of its revenue from advertising, with 88% coming from the U.S. The firm is headquartered in Santa Monica, California.Pinterest is an online product and idea discovery platform that helps users gather ideas on everything from recipes to travel destinations. Founded in 2010, the platform consists of a largely female audience, at roughly two-thirds of its more than 442 million monthly active users. Pinterest generates revenue by selling digital ads and continues to roll out more in-platform e-commerce features.Our study revealed respondents saying Snap's recent partnership with Twitter Inc (NYSE: TWTR), which allows users to share tweets directly on their Snapchat messages, as a driving force for growth and engagement levels for Snap in the coming year. Investors told us they see this partnership as a key function of Snap adding daily active users in 2021.Fifty-four percent of investors told us shares of Snap will grow more by 2022, while 46% of respondents believe Pinterest stock will grow the most by the end of next year.This survey was conducted by Benzinga in December 2020 and included the responses of a diverse population of adults 18 or older.Opting into the survey was completely voluntary, with no incentives offered to potential respondents. The study reflects results from over 200 adults.See more from Benzinga * Click here for options trades from Benzinga * Will AT&T Or Verizon Stock Grow More By 2022? * Will GE's Stock Reach By 2022?(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

How to Invest in Bitcoin: It Can Be Easy, but Watch Out for Fees.

Around 2013, one common way to buy Bitcoin was to head to a public space like Union Square in lower Manhattan. I’m very frustrated that the SEC has not yet approved a Bitcoin ETF. Today, you can still meet a guy in a park (socially distanced, of course), or go to a Bitcoin ATM, but there are other ways to get cryptocurrencies.

A Speculative Frenzy Is Sweeping Wall Street and World Markets

(Bloomberg) -- Animal spirits are famously running wild across Wall Street, but crunch the numbers and this bull market is even crazier than it seems.Global stocks are now worth around $100 trillion. American companies have raised a record $175 billion in public listings. Some $3 trillion of corporate bonds are trading with negative yields.All the while the virus spreads, the economic cycle stays on life-support and businesses get thrashed by fresh lockdowns.Spurred by endless monetary stimulus and bets on a post-pandemic world, day traders and institutional pros alike are enjoying the easiest financial conditions in history.“Sentiment indicators are moving to euphoria,” said Cedric Ozazman, chief investment officer at Reyl & Cie in Geneva. “People are now jumping to invest amid fears they will miss the Santa Claus rally.”Here are the signs of market froth in this year of death, disease and economic calamity.IPO BoomNothing evokes a stock peak like a rush to the public markets. Debuts from Snowflake Inc. to Airbnb Inc. took this year’s initial public offerings volume to a record $175 billion in the U.S., data compiled by Bloomberg show.Special-purpose acquisition vehicles that raise money for a “blank check” company to buy whatever it wants have raised over $60 billion in 2020. That’s more than the previous decade combined.Investors still can’t get enough. The first-day return for IPOs averaged 40% this year, the highest ever other than 1999 and 2000, according to one estimate.All that has drawn unprecedented interest in the Renaissance IPO exchange-traded fund tracking new listings, up more than 100% this year this year. Even SPACs that haven’t announced an acquisition target are up almost 20% in 2020, Bespoke Investment Group noted.“If that isn’t a sign of exuberance, we don’t know what is!” Bespoke analysts wrote in a note.Stock RallyRobinhood traders have become the talk of Wall Street this year by speculating on everything from tech options to airline shares. With these retail investors chasing the equity rally along with institutional pros, the S&P 500 is trading with a sales multiple some 16% above the 2000 peak.Everything is going up. A Goldman Sachs basket of the most-shorted stocks in the Russell 3000 has surged about 40% this quarter, triple the broader index. High-beta shares are near their highest versus low-volatility ones since 2011.Every time the Russell 2000 has surged more than 95% off its trough, it has gone on to lose money over the next three months, according to SentimenTrader. It is now up roughly 100% from its March low.Options FrenzyBullish retail investors have plunged into the complex world of derivatives like never before this year. Over the last 20 days, a record average of roughly 22 million call contracts have traded each day across U.S. exchanges.Cboe’s equity put-call ratio has dropped near a decade low -- a sign traders have rarely ever been so hellbent on chasing upside in single stocks.Merger ManiaAnimal spirits in corporate boardrooms are another infamous sign of a market top. This quarter is shaping up to be the strongest for deal-making activity since 2016 after a record third quarter. S&P Global Inc. buying IHS Markit Ltd. and Advanced Micro Devices Inc. taking over Xilinx Inc. are among the blockbusters.With corporate cash balances rising in recent years and deal volume as a percentage of market value still below a long-time average, it is possible the recent activity is just the start.Europe Joins InEven Europe’s IPO market, which is much smaller in size than the one in the U.S. and less accustomed to big first-day pops, is going bananas.Among the 44 firms that have listed on European exchanges since Nov. 9 -- the day news of a coronavirus vaccine set off a bull run in equities -- the average gain has been 16%, according to data compiled by Bloomberg. About 70% of them are trading above their IPO price.“Given heightened equity valuations, IPOs are again a viable exit route for sponsors,” said Darrell Uden, global co-head of ECM at RBC Capital Markets.Credit ReboundIn a world of almost $18 trillion negative-yielding debt, investors have been forced to gorge on risky corporate bonds at record valuations.In the U.S., yields on junk bonds have tumbled far below levels at which high-grade borrowers could issue earlier this year.Even Carnival Corp., the fallen-angel cruise ship operator, has progressively cut funding premiums this year. The stockpile of negative-yielding corporate debt now stands at over $3 trillion.Emerging MarketsNaturally it’s boom times for emerging-market nations selling more than $730 billion in dollar and euro bonds in 2020, more than in any previous year.Even with political turmoil, Peru sold the lowest-yielding century bonds ever from a developing-economy government. Ivory Coast priced euro-denominated debt with a lower yield than last year, despite its participation in a G-20 debt relief initiative and an ongoing International Monetary Fund program.Bitcoin’s BackTo diehards, Bitcoin’s more than 200% surge this year on a wave of new money shows crypto’s time has come. To many on Wall Street, it’s just the latest sign of irrational exuberance.“We view it and other cryptocurrencies as ‘digital tulips.’ We have no way to value them,” Yardeni Research analysts including Ed Yardeni wrote in a note. “We do watch Bitcoin’s price action as a gauge of speculative excesses.”Its volatility is a hard pill to swallow for most but the likes of JPMorgan Chase & Co. and Nomura Holdings Inc. have noted plenty of interest, from family offices to trend-following quants.The virtual currency is surfing a wave of speculation for long-duration assets, from solar energy to Tesla Inc. shares, as investors seek a stake in a technology of tomorrow -- valuations be damned.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

DraftKings and Square Are Growth Stocks With Ambitions to Be Like Amazon

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This Is Your Last Chance To Buy Tesla Stock Before Its Big Day

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Commodities Are Back In Fashion as Investors Get Ready for Boom

(Bloomberg) -- For the best part of a decade, commodities have been deeply out of fashion. Now, as investors scour the market for the great reflation play, they’re hot again.Investing luminaries from Point72 to Pimco are calling for commodity prices to move higher. Goldman Sachs Group Inc., the bellwether of Wall Street, is predicting a new commodity bull market to rival the China-driven boom of the 2000s and the oil price spikes of the 1970s.“We very much believe that the fundamentals are now in place for a new, structural, bull market to begin,” said Robert Howell, senior research strategist at Gresham Investment Management LLC, the commodities-focused unit of Nuveen with $5.8 billion in assets in the sector. “In the years to come, it’s highly probable that a great many investors will look back on 2020 and wonder how they missed these signs of a new commodity bull market.”Prices have already jumped from their low point in the spring. Copper, iron ore and soybeans have risen to their highest levels in more than six years, spurred by a Chinese buying spree.But now Chinese importers are being joined by global macro investors, drawn to commodities as a bet on the recovery of the global economy as well as a hedge against the prospect of high inflation.Commodities are stereotypical cyclical assets, rising and falling in synchrony with the global economy. That puts them first in line to benefit from the recovery that could be unleashed by virus vaccines.“We are optimistic on commodities overall, as recovering global economic growth and the possibility of higher inflation should be supportive for prices,” says Evy Hambro, who helps manage $16 billion as global head of thematic and sector investing at BlackRock Inc.Nic Johnson, who manages about $20 billion of commodity index investments as well as a separate hedge fund at Pimco, believes commodities “will benefit from the global reflationary theme.”The enthusiasm marks a turnaround for an asset class that has been unloved for years. While investors piled in to commodities as prices soared in the decade to 2011, since then they have soured on the sector. Many of the highest profile hedge funds specializing in commodities exited the markets -- including Astenbeck Capital Management, Blenheim Capital Management, and Clive Capital, each of which managed billions of dollars at its peak.But now that trend is beginning to reverse. The hedge fund industry as a whole has seen outflows this year, but hedge funds focused on commodities have managed to raise money. They pulled in more than $4 billion in flows through October this year compared to about $55 billion in outflows from the industry overall, according to data from eVestment.Fund managers also see growing interest. Don Casturo, who founded Quantix Commodities in 2018 as a boutique focused on the sector after working as chief operating officer for commodities at Goldman Sachs, says he started out calling around asset managers he already knew had an interest in the asset class.“Now we’re responding to incoming calls -– people who’ve decided that commodities are interesting are finding us,” he says. “The environment that was creating such a bullish tailwind for equities and fixed income is coming to an end, and people are looking for alternatives.”Quantix’s long-short commodity fund, which started with $50 million in 2019, now has $620 million under management and has returned just over 15% so far this year, he says. The firm is launching a long-only “inflation index” in February.Others have also notched up a strong performance: oil trader Pierre Andurand’s Discretionary Enhanced Fund was up 152.2% in the year to Dec. 11, according to a person familiar with the matter.Of course, not everyone is unambiguously bullish.For one, prices have already rallied a long way. Johnson of Pimco says he is “most positive” about U.S. natural gas, but doesn’t expect agriculture prices to move higher unless there is a significant decline in crops in the Southern Hemisphere.Analysts at JPMorgan Chase & Co. warned last week that the Chinese credit cycle has already peaked, and forecast lower base metals prices over the course of 2021. And while some are fearful of rising inflation, others see little cause for concern, arguing that global economic activity will remain below capacity for years.Capital ConstraintThe commodity bulls, however, have other arguments in their armory. Casturo of Quantix argues that the rotation back into commodities is still in its infancy, pointing to some $130 billion of passive investor money that has left the sector over the past few years.Many expect stimulus packages targeting the electrification of transport and the growth of renewable energy to boost demand for metals.And across the commodities industry, supply may be constrained after several years of low prices have forced producers to curb spending. Nowhere is that truer than in the oil industry, where the combination of the collapse in prices to below zero in April and investor pressure has led the top companies to slash spending.“Oil and oil equities remain the only reflation asset that is down big year-on-year,” according to Jean-Louis Le Mee and Will Smith, who run the Westbeck Energy Opportunity Fund, which was up 63.6% in the year through November. In a recent letter to investors they argued that capital discipline and a focus on generating free cash flow would “soon resonate with investors while turbo-charging the next oil bull cycle.”The “stars are aligning for higher oil prices.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

How to Fix America’s Yawning Retirement Gap

Unemployment caused by the pandemic has exacerbated a systemic issue: Tens of millions of American workers lack the savings they need for a financially secure retirement. According to the World Economic Forum, the gap between Americans’ personal savings and the money they will need in retirement was $28 trillion in 2015 and growing at a rate of $3 trillion per year. The shortfall has ballooned as a multitude of U.S. companies have forsaken the practice of providing retirement benefits through traditional company-funded pensions—known as defined- benefit plans—and shifted employees to defined-contribution plans such as 401(k)s, which put the onus on employees to save.

Whole Life Insurance Can Bolster Your Retirement Portfolio. Here’s How to Use It.

A growing number of researchers say whole life insurance, a form of permanent life insurance that builds cash value, can buttress investment portfolios and even boost retirement income if used correctly.

Mike Khouw Says It's Time For Bearish Options Trade On Tesla

On CNBC's "Options Action," Mike Khouw suggested a bearish options trade in Tesla Inc (NASDAQ: TSLA). He wants to make a bearish bet in Tesla because the short interest has dropped considerably, the stock is trading at its all-time highs, and he says we have already seen the boosts that came in from the split and from the entrance in the S&P 500. He doesn't know who is going to be a marginal buyer, once all the indexes purchase the stock, and he thinks the valuation is very high.When the stock was trading at $670, Khouw decided to sell the January $700/$720 call spread for a total credit of $7.50. The trade breaks even at $707.50 and it can maximally lose $12.50. The stock closed the session at $695.See more from Benzinga * Click here for options trades from Benzinga * Cramer Shares His Thoughts On Wells Fargo, Caterpillar And More * 'Fast Money' Picks For December 21(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

PayPal Stock Still Has a Long Way to Run

With the growth of digital payments very strong and likely to remain elevated going forward, PayPal (NASDAQ:PYPL), the runaway leader of the sector, continues to be a very good choice for risk-averse investors looking for a technology name. And going forward, PayPal stock will continue to have many powerful growth catalysts, including network effects and the expansion of its physical business. Source: JHVEPhoto / Shutterstock.com

Not surprisingly, the novel-coronavirus pandemic, which tremendously increased the popularity of e-commerce, has consequently resulted in an acceleration of demand for digital payments. As ResearchandMarkets.com stated in May:InvestorPlace - Stock Market News, Stock Advice & Trading Tips “People are using digital payment options to avoid contact and spread of infection through direct cash handling, and also to adhere to social distancing to curb the spread of Covid-19. Due to closure of local market places and to avoid public gathering, people are preferring online purchase of essential supplies, which in turn is increasing the demand for the digital payments market.” As a leader in the digital-payment space, PayPal has, of course, benefited from the sector’s incredible growth. In fact, in Q3, its net revenue jumped 24% year-over-year, versus a 19% YOY jump in the first nine months of the year. Last quarter, its total payments volume jumped an impressive 36% YOY, excluding the impact of currency fluctuations. According to the company, the latter increase represents an all-time record. Further, PayPal added 15.2 million net active users last quarter, and as of the end of the third quarter, it has a total of 361 million active accounts. Finally, the company remains extremely profitable, as it generated nearly $3 billion of free cash flow in the first nine months of the year. Why PayPal’s Growth Is Likely to Stay Strong PayPal CEO Daniel Schuman recently said that the pandemic had lowered the time needed to transition to digital payments “maybe three to five years.” After the pandemic, he indicated that he does not expect the e-commerce megatrend to ease. I think Schuman, who expects e-commerce to retain its current 70% market share following the pandemic, up from 30% before the coronavirus, is a bit off the mark. It’s true that millions of consumers who rarely or never utilized e-commerce before the coronavirus have begun doing so regularly during the pandemic, and that these individuals will utilize it significantly after the Covid-19 pandemic. Yet since many people like shopping at stores, especially for clothes and large-ticket items, while products can still be acquired more quickly at stores than online, I think we’ll see a roughly 50/50 split between physical stores and e-commerce post-pandemic. Still, that’s a very favorable mix for PayPal. Also positive for PayPal and PayPal stock is the cycle of “network effects” that it enjoys. In other words, as more consumers use PayPal, more merchants will begin accepting it, which will incentivize even more consumers to utilize it. In a related note, PayPal has been successfully moving into what it calls “physical retail,” i.e. providing retailers with QR readers that allow consumers to pay for products in stores using their PayPal accounts. Among the retailers that recently joined that program are CVS (NYSE:CVS), Nike (NYSE:NKE) and Bed Bath & Beyond (NASDAQ:BBBY).

The Bottom Line on PayPal Stock PayPal has only scratched the surface of the huge global payments market, which, in 2018, the company estimated was worth about $110 trillion. PayPal’s first-mover advantage in digital payments, combined with the likely continued, rapid growth of the sector, should enable it to meaningfully increase its share of the global-payments market every year. Consequently, I recommend that longer-term investors buy PayPal stock. On the date of publication, Larry Ramer did not have (either directly or indirectly) any positions in the securities mentioned in this article.  Larry Ramer has conducted research and written articles on U.S. stocks for 13 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been Roku, solar stocks, and Snap. You can reach him on StockTwits at @larryramer. More From InvestorPlace

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The Fed Just Said Banks Could Buy Back Stock Again. JPMorgan and Goldman Sachs Are Soaring.

The Federal Reserve’s latest stress-test results are out, and if the stock market is any indication it looks like many large banks passed.

The Week Ahead In Biotech: Light Calendar In Abbreviated Week Features 1 IPO, 1 FDA Decision

Biotech stocks extended their weekly gains for the fourth straight week, thanks to broader market buoyancy, positive FDA decisions and vaccine news.In a widely expected decision, Moderna Inc's (NASDAQ: MRNA) coronavirus vaccine candidate was cleared for emergency use by the FDA.MacroGenics Inc (NASDAQ: MGNX) received a regulatory nod for its breast cancer treatment, while the FDA also approved Amgen, Inc.'s (NASDAQ: AMGN) Rituxan biosimilar and Myovant Sciences Ltd's (NYSE: MYOV) relugolix for the treatment of metastatic prostate cancer.Arvinas Inc (NASDAQ: ARVN) was among the best performing biotech stocks of the week after it issued an update on two of its pipeline assets.The week also witnessed some M&A activity. Eli Lilly And Co (NYSE: LLY) announced a deal to buy gene therapy company Prevail Therapeutics Inc (NASDAQ: PRVL) for a little over $1 billion.Three biopharma companies debuted on Wall Street, raising $463 million in combined gross proceeds.Here are the key catalysts for the unfolding, holiday-shortened week:Related Link: Sarepta, Amicus Top Biotech Picks Ahead Of Key Binary Events: AnalystPDUFA Dates The FDA is scheduled to give its verdict on Urovant Sciences Ltd's (NASDAQ: UROV) new drug application for vibegron on Dec. 26. The company is seeking approval for once-daily 75 mg vibegron for the treatment of overactive bladders.IPOs Netherlands-based specialty pharma Pharming Group N.V. has filed to offer 899,802 ADSs, each representing 10 ordinary shares, in an initial public offering estimated to be priced at $12.10 per ADS. The company has applied for listing its ADSs on the Nasdaq under the ticker symbol PHAR.IPO Quiet Period Expiry Lixte Biotechnology Holdings Inc (NASDAQ: LIXT)See more from Benzinga * Click here for options trades from Benzinga * The Daily Biotech Pulse: FDA Nod For Amgen's Biosimilar, Moderna's Vaccine Vote, Mesoblast Sinks On Data * The Daily Biotech Pulse: MacroGenics Breast Cancer Drug Wins FDA Approval, Adcom Test Awaits Moderna, Virios To Make Wall Street Debut(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

How to Manage the Taxes on a Covid-Related Withdrawal From Your IRA or 401(k)

The Cares Act lets people of any age take up to $100,000 from their IRA or 401(k) by Dec. 30 without a penalty.

Ideanomics Could Be the Ultimate ‘X Factor’ Trade

On principle and devoid of any other context, Ideanomics (NASDAQ:IDEX) offers a compelling concept. As a business conglomerate investing in the electric-vehicle (EV) and battery-charging markets (along with exposure to the raging hot blockchain sector), the organization is certainly relevant. But the main challenge for IDEX stock is that it’s a narrative play. Source: nrqemi / Shutterstock.com

What do I mean by that? Basically, you’re waiting for that next catalyst that will drive IDEX to the moon. It almost always starts with someone having some idea to do something and that something turns out to be big, like 10x big. Then another something by someone will be even bigger, like 100x bigger. And yet another something will lead to something else and it will be the biggest, like 33,980,410x biggest. I got that last number by calculating the theoretical profitability of buying Berkshire Hathaway (NYSE:BRK.A) at a penny. Obviously, I’m being facetious. But if you look at the wild swings of IDEX stock over the trailing five years, you can see why I’m concerned. The extreme peaks and valleys indicate that investors are waiting for the next hit, like a junkie.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Outside of those hits, IDEX stock is liable to crater. Thus, the lack of sustainability whenever positive momentum arrives is worrisome. Please don’t get me wrong — there’s opportunity in these types of trades. For instance, I discussed penny stocks to buy for those that can stomach the risk. Some of these were winners, some were terrible losers. Technically, based on the publication date, Ideanomics was a winner, but believe me — I’m not patting myself on the back.

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Why? Because after an initial spike, IDEX began to tumble into what looked at the time as the spiral of death. Then, a few fateful days in November spared my blushes. That’s awesome for me (I guess), but this is a difficult life for most investors. The Fundamental Backdrop for IDEX Stock In other words, Ideanomics is a trade, and it can work wonderfully for those who truly understand such sectors. With effective risk-mitigation protocols, IDEX stock theoretically wouldn’t be a bad idea to put into your speculative portfolio. Most importantly, the company is tied to the burgeoning EV market, specifically the fleet vehicle segment. What could go wrong? Hopefully nothing if you’re eschewing all good advice and going all-in, hoping to score that (insert multiple here)-bagger. But is there a fundamental case for IDEX stock? From the available data, it seems that there was a case. Let me explain.

In the five quarters leading into 2020, China’s consumer confidence index — as prepared by the National Bureau of Statistics of China — averaged just under 125 points. But it really started to pick up in the latter half of 2019, which made sense. Relations between Washington and Beijing were improving, implying the end to the trade war. Click to EnlargeSource: Chart by Josh Enomoto Additionally, the inflation rate started to rise, which was a logical development. Stronger consumers buy stuff, which raises demand, which in turn raises prices. But then the novel coronavirus hit and everything went haywire. Consumer confidence plummeted, as you would expect. However, since bottoming out in June, sentiment has charged higher. Still, the takeaway is that the latest read (as of September 2020) is 120.5 points, 3.6% off the aforementioned average. But what truly caught my attention was the inflation rate. After a brief stabilization period, the rate has been cratering. This severe erosion makes me very suspicious about the health of the Chinese economy. Put another way, one of these metrics will be proven right, either consumer confidence is strong, or inflation is low, meaning deflation is a growing threat.

Under those circumstances, I’d rather hold off on massive wagers on penny stocks tied to Chinese consumer markets. Commodities Signaling a Clue? Finally, another reason to stay on the conservative side is the rise in precious metals and cryptocurrencies. Of course, the former has always been a safe-haven sector, a reliable anchor even if that anchor doesn’t pay dividends or do much of anything. The latter has been an outright phenomenon, perhaps heading toward some heady prices. But the obvious reality is that when these assets move higher, they’re taking capital from something. And that something probably isn’t a recognized blue chip which supports millions of 401k plans. No, it’s probably that something that leads to something big, which leads to something bigger … you get my drift. As I said, I’m not opposed to IDEX stock. You can do whatever you want with your money. I’m just saying I don’t like the fundamentals. And I’m not sure I like the technicals either, considering that the speculative money appears to have found its favorite vices. On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.  More From InvestorPlace

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