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Minggu, 07 Februari 2021

Hunting for the next GameStop — Exclusive chat with Carson Block — Grappling with inflation fears

 
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INSIDER INVESTING
 
 
 
 

Hello and welcome to Insider Investing. I'm Joe Ciolli, and I'm here to guide you through what's been happening in markets, as well as what to expect in the coming weeks. Here's what's on the docket:

If you aren't yet a subscriber to Insider Investing, you can sign up here.

Have thoughts on the newsletter? Just want to talk markets? Feel free to drop me a line at jciolli@insider.com or on Twitter @JoeCiolli.


Your weekly outlook

If you expected GameStop mania to subside this past week, then you were sorely mistaken. The stock — and its similarly shorted brethren — took traders on a volatile ride, following steep sell-offs with torrid rallies. The so-called meme stocks are now well below highs, but also didn't collapse immediately like many thought they would.

This recent price action has set up a make-or-break week of sorts for the Reddit revolution. Much of the focus will be on whether the retail-investor cohort can "hold the line" and avoid being swept up in profit-taking. Attention will also be paid to the brewing situation surrounding famed Wall Street Bets day trader Keith Gill, who's under investigation as regulators look at his previous financial-advisement job.

Another lingering concern is that the Reddit legion will try to squeeze another heavily shorted asset. They already tried — and mostly failed — to do it with silver this past week. Given how that squeeze fizzled out, market watchers will be asking themselves if the jig is up, or if silver was just the wrong target.

The stimulus front will also be jam-packed with updates. President Joe Biden has made it clear that he's going to push through his $1.9 trillion bill with or without GOP backing, and concrete progress is being made to that end.

To date, positive stimulus updates have been met with stock-market gains as traders scramble to price in a stronger economic recovery. And conversely, any hold-ups have seen sharp selling. Expect volatility along those lines as stimulus haggling continues into next week.


Hunting for the next GameStop

gamestop line

In the wake of GameStop mania, everyone from day traders to institutional investors are scrambling to scoop up shares of the next big short squeeze target. Firms across Wall Street have been busy analyzing the market and pinpointing such names they recommend buying now.

Read the full stories here:

Buy these 26 heavily shorted stocks as retail traders trigger wild rallies in Wall Street's least liked names, Wells Fargo says

Jefferies says these 20 heavily shorted and lightly traded stocks could see big jumps in the event of a GameStop-like squeeze


An exclusive chat with short-seller extraordinaire Carson Block

Carson Block, muddy waters

In an exclusive interview, Carson Block of Muddy Waters Research explained to us how bubbles are forming in individual stocks like GameStop. The famed short-seller cites constant flows to passive investment vehicles, which he says is driving out active managers, leaving the market more vulnerable to sell-offs.

Read the full story here:

Famed short seller Carson Block says a new type of liquidity bubble is feeding the wild swings in day-trading favorites like GameStop — and that stocks have become a fragile 'game'


How to contend with inflation fears stemming from stimulus

Fed Jerome Powell

Inflation has not meaningfully risen in the US in several years, but waves of fiscal and monetary stimulus could change that and impact inflation-sensitive assets. Five experts dive into the prospects of an inflation comeback and how to position portfolios for it.

Read the full story here:

Biden's stimulus plan is heightening Wall Street's worries that inflation will upend the stock market. We spoke to 4 experts on what the raging debate means for investors, and how to take advantage of it.


Stock pick central

Seeking experts who are willing to name names? Look no further:

 
 
 
 
 
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