Libra, the cryptoasset devised by Facebook, is reportedly planning to launch as early as January, as per the Financial Times, although it will be a scaled down version of what was originally planned.
The FT quotes unnamed sources as saying the launch will now be focused on one single cryptoasset, rather than the launch of several coins. The global stablecoin project was initially proposed to be pegged to a basket composed of multiple fiat currencies, but it has changed plans following regulatory pressure from the US and abroad.
It comes in the same week that bitcoin hit a record peak, only to sell off sharply following its mammoth run upwards. Yesterday, the 20 day moving average (green line) seemed to hold although it looks like it will be tested again today.
Commodities markets edged lower overnight after a strong run in November. Among the key movers, the price of oil – which hit an 8 month high this week only to dip on supply concerns. Gold, where the rally has stalled since the US election result and news of virus vaccines, was up marginally at $1,806, some way off its August peak above $2,000.
Global stocks dip as vaccine doubts emerge; US markets closed
The rally in global shares to near-record highs stalled overnight, with concerns about the path of coronavirus once again flaring up. US cases of Covid-19 are at a record and experts warn that Thanksgiving gatherings could lead to further infections and deaths.
The virus concerns, made worse by news that AstraZeneca’s vaccine is not as effective as previously hoped, coupled with a US market shuttered for the holidays, saw global indices largely tread water. Both the Japanese Nikkei and Hong Kong’s Hang Seng were up less than 0.5%, eking out minor gains, while US futures markets were pointing marginally lower ahead of a reduced trading session today which will last only a few hours.
S&P 500: -0.2% Wednesday (closed Thursday), +12.4% YTD
Dow Jones Industrial Average: -0.6% Wednesday (closed Thursday), +4.7% YTD
Nasdaq Composite: +0.5% Wednesday (closed Thursday), +34.8% YTD
FTSE dips as new lockdown rules revealed
UK markets edged lower on Thursday, with some cyclical names giving back recent gains, amid news of the new tiering system, which will dictate how people can live their lives against the backdrop of Covid. More than 20 million people across England were put under the toughest restrictions even after a national lockdown ends next week, although the majority of the country is in the less severe tier 2 category, which will enable them to meet up to six people once again.
Meanwhile, AstraZeneca’s coronavirus drug is under pressure after the efficacy of the vaccine faced more intense scrutiny, which experts say could delay its approval. Several scientists have raised doubts about the robustness of results showing the shot was 90% effective in a sub-group of trial participants who, by error initially, received a half dose followed by a full dose. AstraZeneca’s shares dipped 0.67% yesterday on the news to £77.48, and remain far from recent highs above £90. Other losers included the housebuilder sector, with big names like Persimmon off 5.2%.
The FTSE 250 also fell back, dragged down by value stocks including Virgin Money which dived over 9% yesterday on news that its pre-tax profit fell by three-quarters in the year to October, thanks mainly to a £501m provision to cover bad loans caused by the pandemic.
FTSE 100: 6,362- 0.4% Thursday, -15.6% YTD
FTSE 250: 19,396 – 0.88% Thursday, – 11.5% YTD
What to watch
Black Friday: Today marks the official start of the Black Friday sales event (although many outlets started cutting prices weeks ago). With many retailers around the world (particularly in the UK) locked down because of Covid, all the signs point firmly at the online retail giants to clean up once again. Last year, according to Salesforce data, Black Friday saw $7.2 billion in digital sales in the US alone, up 14% year-on-year, and many expect that number to be shattered again in 2020.
Zoom Q3 results: Shares in Zoom have gained almost 500% year-to-date and demand for the company’s cloud-native video-first platform is expected to remain solid, when it announces its Q3 results on Monday. Expanding clientele is expected to drive top-line growth momentum in the near term, and the company’s expanding international presence will also be a key focus.
Crypto corner: Coinbase CEO warns Trump may rush out new restrictions.
Coinbase chief executive Brian Armstrong has warned the outgoing Trump Administration may rush out rules that impact the ease of trading crypto.
Armstrong said on Twitter that rumours the US Treasury Department will attempt to track owners of self-hosted cryptocurrency wallets with an onerous set of data-collection requirements “would have unintended consequences”.
There has been talk that Treasury Secretary Steven Mnuchin is preparing to force individuals who hold their own cryptoassets in wallets to have to share information before payments can be made.
“This proposed regulation would, we think, require financial institutions like Coinbase to verify the recipient/owner of the self-hosted wallet, collecting identifying information on that party, before a withdrawal could be sent to that self-hosted wallet,” Armstrong tweeted.
All data, figures & charts are valid as of 27/11/2020.
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