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Wealth Daily 07 February 2022

WEALTH DAILY 2022-02-07
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US equities ended a volatile week of trading on a high note last Fri. Amazon (AMZN US, +13.54%) posted its best day in nearly seven years. After strong jobs data, fixed income derivatives began indicating that the US Federal Reserve could raise rates even faster than previously expected. However, equities remained resilient. 

The Dow Jones Industrial Average lost 21.42 pts or 0.06% lower to close at 35,005.00. The broader S&P 500 index rose 0.52%. The tech-heavy Nasdaq Composite advanced 1.58%. The small cap Russell 2000 gained 0.57%. 

Amazon rallied after saying it will raise the cost of Prime and that the Black Friday-Cyber Monday period was its most successful ever. 

Higher US interest rates could benefit bank shares. Bank of America (BAC US, +3.98%), JP Morgan (JPM US, 2.6%) and Wells Fargo (WFC US, 2.1%) gained. 

Peloton (PTON US, +1.44%) soared 26.42% in after-hours trade last Fri. The WSJ reported Amazon has been speaking to advisers about a potential offer. Nike (NKE US, +0.06%) is also weighing a bid, but neither it nor Amazon have held direct talks with the company, according to a FT report. 

The yield on the 10-year Treasury note notched up 7.78 basis points (bps) to 1.9085%, as traders gave roughly even odds to the chance the Fed will start to raise interest rates with a 50 bps hike in Mar instead of a typical 0.25 bps move. 

The most actively traded US gold futures (Apr) contracts settled up $3.70, or 0.2%, at US$1,807.80/oz. March silver, which is the most actively traded silver futures, rose 10 cents, or 0.4%, to end at US$22.475/oz. 

The ICE dollar index (DXY), which measures the strength of the greenback against a basket of currencies, rose 0.11% to 95.485.  Oil has rocketed to a fresh seven-year high. The front-month Brent and WTI futures closed up $2.16 at US$93.27/bbl and $2.04 at US$92.31/bbl respectively. 

European equity markets finished lower last Fri. The UK FTSE lost 0.17%, France's CAC 40 fell 0.77%, while the German DAX retreated 1.75%. Banking shares were among the best performers in Europe. Spanish banks CaixaBank (CABK SM, 4.9%) and Banco Sabadell (SAB SM, 7.09%), which get most of their business from lending were particularly strong.

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