Market Commentary — December 6, 2021
Markets were volatile last week thanks to concerns about faster Fed tapering and fears that the emergence of the new COVID strain Omicron could dampen global growth and exacerbate supply chain issues.
The Treasury yield curve flattened, with short-term yield increasing and long-term rates decreasing. Fed Chair Powell’s acknowledged that inflation might not be as “transitory” as modeled, especially given new variant news, necessitating an accelerated pace for bond purchase tapering.
Not helping the market’s mood was weaker-than-expected job creation in November. Non-farm payrolls increased by 210,000 for the month, well below October’s total of 546,000 last month. Given inflation concerns, decelerating job growth is unlikely to shift the Fed’s plan to taper asset purchases.
All of this news made for a “risk-off” sell-off, with tech names giving up the most ground. Not helping China ADRs was news that DiDi Global would be delisting in the US in favor of a Hong Kong listing. Also adding to the tech sell-off was a big earnings miss by hot pandemic play DocuSign, which lost more than 40%.
Mega-RIA Ritholtz Wealth Management teamed with WisdomTree to unveil the RWM WisdomTree Crypto Index backed by crypto held in storage and supported by Onramp Invest’s technology platform. And there were new thematic ETFs launched covering blockchain and crypto mining. Meanwhile, crypto dropped like a rock over the weekend as an extension of the risk-off trade.
Hopefully, next week will see a resumption of the market’s bullish holiday spirit.
CEO and Co-Founder