Reddit Rally: Robinhood unveiled as the Sheriff of Nottingham
It wasn’t supposed to be this way, but the Reddit army discovered their favourite broker for taking from the rich, Robinhood, was secretly the Sheriff of Nottingham. That dominated business news overnight as the Sheriff and his band of merry online brokers put a stop to the peasants’ rebellion by restricting trading in GameStop and AMC, among others.
“The resulting price plunge had the media wailing that $11bn of value was wiped out in a single day; however, I would argue that there was never $11bn of value in the first place,” commented Jeffrey Halley, senior market analyst at OANDA, this morning.
“All the noise from the market’s discount circle seats drowned out the US data releases overnight,” he said, as US GDP rose 4 per cent QoQ, “slightly lower than expected, but not enough to set off a double-dip panic.”
Weekly jobless claims outperformed at 847,000 jobs lost. “It’s a strange old world where 847,000 new jobless claims from Americans in just one week, is perceived as good news. If nothing else, it reinforces the Federal Reserve’s dovish mantra from the day before,” Hall said.
Mini tantrum
That was enough to stop the mini taper tantrum of the previous day in its tracks, Hall continued. US equities clawed back some of the earlier days’ losses, the US Dollar edged lower, and US Treasury yields rose slightly.
“With the Sheriff of Nottingham burning the peasants’ crops, markets can now get back to the bigger issues at hand,” he said, pointing out US personal income is expected to rise 0.1 per cent in December with the closely watched PCE Price Index rising 1.1 per cent YoY.
“Only a substantial deviation is likely to be market-moving though with December data rapidly becoming old news,” Hall concluded.