HUL vs ITC: Stock and Business comparison
https://www.learnstockmarket.in/versus/hul-vs-itc-stock-business/
https://www.learnstockmarket.in/versus/hul-vs-itc-stock-business/
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HUL vs ITC: Stock and Business comparison
Hindustan Unilever Limited (HUL) and ITC are two of the biggest FMCG companies in India. The stock performance of the two companies, though, have been in
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*Today's Corporate Action*
*20th May Ex Date*
GREENCREST
Consolidation of Shares
IRCON
Bonus issue 1:1
JOSTS
Stock Split From Rs.10/- to Rs.5/-
MINDSPACE
Income Distribution
*Today's Key Results/Board Meetings*
*20-May-21*
AEL
General
AMARDEE
Audited Results
AMRAAGRI
Audited Results
BIRET
Audited Results
BOSCHLTD
Audited Results; Dividend
CMMHOSP
General
COSMOFILMS
Audited Results
DISAQ
A.G.M.; Audited Results; Final Dividend
ECOBOAR
General
ELECTCAST
Audited Results; Dividend
EMKAY
Audited Results;
Final Dividend
EPL
Audited Results;
Final Dividend
EXPLEOSOL
Audited Results
GIPCL
Audited Results; Dividend
HAVELLS
Audited Results;
Final Dividend
HINDPETRO
Audited Results;
Final Dividend
IL&FSENGG
General
INDINFR
Audited Results
JKLAKSHMI
Audited Results; Dividend
KNRCON
Audited Results;
Final Dividend
LIBORD
Audited Results
LIBORDFIN
Audited Results
MANGALAM
Audited Results
MEGH
Audited Results
NDTV
Audited Results
PLASTIBLEN
Audited Results
PRESHAMET
Audited Results
RADIOCITY
Audited Results
RELAXO
Audited Results;
Final Dividend
RESPONSINF
Audited Results
RPEL
A.G.M.
STERWEB
Audited Results
THEINVEST
Audited Results
TORNTPOWER
Audited Results;
Final Dividend
TRELCHE-B
General
ULTRAMAR
Audited Results; Dividend
USHAMART
Audited Results
VIRAT
Audited Results;
Final Dividend
ZEEL
Audited Results;
Final Dividend
*Stock under F&O ban on NSE*
*20-May-21*
1CADILAHC
2NATIONALUM
3SAIL
Nikkei -121 pts
Hangseng -180 pts
Now @6.54am
Dow -164.62 pts ,Nsdq -3.90 pts, S&P -12.15 pts, Bovespa +343 pts , Ftse -84 pts , Dax -273 pts , Cac -91 pts , Crude @ $63.37 brl (-0.01), Brent @ $66.66 brl (+0.00) , Gold @ 1867.10 (-14.30), Silver @ $27.72 (-0.30), Euro @ $1.2171, JPY @ $109.26 INR @ 73.215
*Today's Corporate Action*
*20th May Ex Date*
GREENCREST
Consolidation of Shares
IRCON
Bonus issue 1:1
JOSTS
Stock Split From Rs.10/- to Rs.5/-
MINDSPACE
Income Distribution
*Today's Key Results/Board Meetings*
*20-May-21*
AEL
General
AMARDEE
Audited Results
AMRAAGRI
Audited Results
BIRET
Audited Results
BOSCHLTD
Audited Results; Dividend
CMMHOSP
General
COSMOFILMS
Audited Results
DISAQ
A.G.M.; Audited Results; Final Dividend
ECOBOAR
General
ELECTCAST
Audited Results; Dividend
EMKAY
Audited Results;
Final Dividend
EPL
Audited Results;
Final Dividend
EXPLEOSOL
Audited Results
GIPCL
Audited Results; Dividend
HAVELLS
Audited Results;
Final Dividend
HINDPETRO
Audited Results;
Final Dividend
IL&FSENGG
General
INDINFR
Audited Results
JKLAKSHMI
Audited Results; Dividend
KNRCON
Audited Results;
Final Dividend
LIBORD
Audited Results
LIBORDFIN
Audited Results
MANGALAM
Audited Results
MEGH
Audited Results
NDTV
Audited Results
PLASTIBLEN
Audited Results
PRESHAMET
Audited Results
RADIOCITY
Audited Results
RELAXO
Audited Results;
Final Dividend
RESPONSINF
Audited Results
RPEL
A.G.M.
STERWEB
Audited Results
THEINVEST
Audited Results
TORNTPOWER
Audited Results;
Final Dividend
TRELCHE-B
General
ULTRAMAR
Audited Results; Dividend
USHAMART
Audited Results
VIRAT
Audited Results;
Final Dividend
ZEEL
Audited Results;
Final Dividend
*Stock under F&O ban on NSE*
*20-May-21*
1CADILAHC
2NATIONALUM
3SAIL
World Markets
Dow - 165
Nasdaq - 4
Dax - 273
Nikkei - 80
Hangseng - 253
Sgxnifty + 4 (15053)
Brent Crude 66.87
Dow Fut - 70
Dollar Index 90.14
Dow - 165
Nasdaq - 4
Dax - 273
Nikkei - 80
Hangseng - 253
Sgxnifty + 4 (15053)
Brent Crude 66.87
Dow Fut - 70
Dollar Index 90.14
*Gravita India Ltd.* | *CMP* Rs. 115 | *M Cap* Rs. 794 Cr | *52 W H/L* 123/32
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 438.3 Cr (17.3% QoQ, 15.6% YoY) vs QoQ Rs. 373.6 Cr, YoY Rs. 379.3 Cr
EBIDTA came at Rs. 42.3 Cr (28.9% QoQ, 45.8% YoY) vs QoQ Rs. 32.8 Cr, YoY Rs. 29 Cr
EBITDA Margin came at 9.6% vs QoQ 8.8%, YoY 7.6%
Adj. PAT came at Rs. 21.4 Cr vs QoQ Rs. 15.7 Cr, YoY Rs. 17.8 Cr
Quarter EPS is Rs. 3.1
Share is trading at P/E of 15.1x TTM EPS
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 438.3 Cr (17.3% QoQ, 15.6% YoY) vs QoQ Rs. 373.6 Cr, YoY Rs. 379.3 Cr
EBIDTA came at Rs. 42.3 Cr (28.9% QoQ, 45.8% YoY) vs QoQ Rs. 32.8 Cr, YoY Rs. 29 Cr
EBITDA Margin came at 9.6% vs QoQ 8.8%, YoY 7.6%
Adj. PAT came at Rs. 21.4 Cr vs QoQ Rs. 15.7 Cr, YoY Rs. 17.8 Cr
Quarter EPS is Rs. 3.1
Share is trading at P/E of 15.1x TTM EPS
*Endurance Technologies Ltd.* | *CMP* Rs. 1357 | *M Cap* Rs. 19086 Cr | *52 W H/L* 1540/602
(Nirmal Bang Retail Research)
*Result is marginally ahead of expectation*
Revenue from Operations came at Rs. 2132.9 Cr (4.5% QoQ, 33.6% YoY) vs expectation of Rs. 1979.7 Cr, QoQ Rs. 2040.9 Cr, YoY Rs. 1596.8 Cr
EBIDTA came at Rs. 332.2 Cr (-5.7% QoQ, 39.7% YoY) vs expectation of Rs. 316.4 Cr, QoQ Rs. 352.1 Cr, YoY Rs. 237.9 Cr
EBITDA Margin came at 15.6% vs expectation of 16%, QoQ 17.3%, YoY 14.9%
Adj. PAT came at Rs. 187.4 Cr vs expectation of Rs. 149.5 Cr, QoQ Rs. 201.3 Cr, YoY Rs. 106.8 Cr
Quarter EPS is Rs. 13.3
Share is trading at P/E of 27.2x FY22E EPS
(Nirmal Bang Retail Research)
*Result is marginally ahead of expectation*
Revenue from Operations came at Rs. 2132.9 Cr (4.5% QoQ, 33.6% YoY) vs expectation of Rs. 1979.7 Cr, QoQ Rs. 2040.9 Cr, YoY Rs. 1596.8 Cr
EBIDTA came at Rs. 332.2 Cr (-5.7% QoQ, 39.7% YoY) vs expectation of Rs. 316.4 Cr, QoQ Rs. 352.1 Cr, YoY Rs. 237.9 Cr
EBITDA Margin came at 15.6% vs expectation of 16%, QoQ 17.3%, YoY 14.9%
Adj. PAT came at Rs. 187.4 Cr vs expectation of Rs. 149.5 Cr, QoQ Rs. 201.3 Cr, YoY Rs. 106.8 Cr
Quarter EPS is Rs. 13.3
Share is trading at P/E of 27.2x FY22E EPS
*Vishnu Chemicals Ltd.* | *CMP* Rs. 355 | *M Cap* Rs. 424 Cr | *52 W H/L* 370/112
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 213.6 Cr (59.7% QoQ, 36.2% YoY) vs QoQ Rs. 133.7 Cr, YoY Rs. 156.8 Cr
EBIDTA came at Rs. 24.7 Cr (63.5% QoQ, 56% YoY) vs QoQ Rs. 15.1 Cr, YoY Rs. 15.8 Cr
EBITDA Margin came at 11.6% vs QoQ 11.3%, YoY 10.1%
Adj. PAT came at Rs. 10.9 Cr vs QoQ Rs. 3.7 Cr, YoY Rs. 5.1 Cr
Quarter EPS is Rs. 9.1
Share is trading at P/E of 12.3x TTM EPS
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 213.6 Cr (59.7% QoQ, 36.2% YoY) vs QoQ Rs. 133.7 Cr, YoY Rs. 156.8 Cr
EBIDTA came at Rs. 24.7 Cr (63.5% QoQ, 56% YoY) vs QoQ Rs. 15.1 Cr, YoY Rs. 15.8 Cr
EBITDA Margin came at 11.6% vs QoQ 11.3%, YoY 10.1%
Adj. PAT came at Rs. 10.9 Cr vs QoQ Rs. 3.7 Cr, YoY Rs. 5.1 Cr
Quarter EPS is Rs. 9.1
Share is trading at P/E of 12.3x TTM EPS
*JK Tyre & Industries Ltd.* | *CMP* Rs. 124 | *M Cap* Rs. 3053 Cr | *52 W H/L* 147/48
(Nirmal Bang Retail Research)
*Result improved* *Company has reduced debt by around Rs.1000cr*
Revenue from Operations came at Rs. 2927.3 Cr (5.7% QoQ, 63.1% YoY) vs QoQ Rs. 2769.3 Cr, YoY Rs. 1794.8 Cr
EBIDTA came at Rs. 454.7 Cr (-9.1% QoQ, 119.2% YoY) vs QoQ Rs. 500.4 Cr, YoY Rs. 207.4 Cr
EBITDA Margin came at 15.5% vs QoQ 18.1%, YoY 11.6%
Adj. PAT came at Rs. 179.6 Cr vs QoQ Rs. 183.9 Cr, YoY Rs. 13.9 Cr
Quarter EPS is Rs. 7.3
Share is trading at P/E of 10.8x TTM EPS
(Nirmal Bang Retail Research)
*Result improved* *Company has reduced debt by around Rs.1000cr*
Revenue from Operations came at Rs. 2927.3 Cr (5.7% QoQ, 63.1% YoY) vs QoQ Rs. 2769.3 Cr, YoY Rs. 1794.8 Cr
EBIDTA came at Rs. 454.7 Cr (-9.1% QoQ, 119.2% YoY) vs QoQ Rs. 500.4 Cr, YoY Rs. 207.4 Cr
EBITDA Margin came at 15.5% vs QoQ 18.1%, YoY 11.6%
Adj. PAT came at Rs. 179.6 Cr vs QoQ Rs. 183.9 Cr, YoY Rs. 13.9 Cr
Quarter EPS is Rs. 7.3
Share is trading at P/E of 10.8x TTM EPS
*Crypto Currency Fall today 20---40%*
After CHINA declare Ban to crypto payment
And Tesla... Elon musk share holding in Bitcoin
Bitcoin market cap
55 lac crore
Almost 15 lac cr Loose by investors Today After ban In china
*Today Investors loose*
75 lac Crore In crypto currency
After fall in Etherium... Bnb coin and bitcoin And other coins
After CHINA declare Ban to crypto payment
And Tesla... Elon musk share holding in Bitcoin
Bitcoin market cap
55 lac crore
Almost 15 lac cr Loose by investors Today After ban In china
*Today Investors loose*
75 lac Crore In crypto currency
After fall in Etherium... Bnb coin and bitcoin And other coins
#HindCopper is Mutual Fund's Top Buy Amongst Small Cap In April-21.
Net Buying in April By MF's 218 Crore INR..💸
Net Buying in April By MF's 218 Crore INR..💸
CENTRAL BANK OF INDIA , Bank Of India , IOB : Sources says central bank of India, IOB , BANK OF INDIA name in Privatisation list
Indusind Bank says Sumant Kathpalia, MD & CEO plans to sell some shares held by him via exercise of previous ESOPs. He will sell shrs to repay loans to exercise earlier vested ESOPs
SETBACK FOR PRIVATISATION
BPCL PRIVATISATION FURTHER DELAYED
TIMELINE OF MAJOR PRIVATISATION LIKE BPCL BEING MOVED BACK:
BPCL PRIVATISATION FURTHER DELAYED
TIMELINE OF MAJOR PRIVATISATION LIKE BPCL BEING MOVED BACK:
*Heritage Foods Ltd.* | *CMP* Rs. 362 | *M Cap* Rs. 1680 Cr | *52 W H/L* 391/225
(Nirmal Bang Retail Research)
*Result is below expectations*
Revenue from Operations came at Rs. 619.4 Cr (2.4% QoQ, -5.1% YoY) vs expectation of Rs. 632.4 Cr, QoQ Rs. 604.9 Cr, YoY Rs. 652.6 Cr
EBIDTA came at Rs. 47.8 Cr (-16.8% QoQ, -114.6% YoY) vs expectation of Rs. 81.9 Cr, QoQ Rs. 57.4 Cr, YoY Rs. -327.1 Cr
EBITDA Margin came at 7.7% vs expectation of 12.9%, QoQ 9.5%, YoY -50.1%
Adj. PAT came at Rs. 24.3 Cr vs expectation of Rs. 42.4 Cr, QoQ Rs. 26.4 Cr, YoY Rs. -209.2 Cr
Quarter EPS is Rs. 5.2
Share is trading at P/E of 11.1x FY22E EPS
(Nirmal Bang Retail Research)
*Result is below expectations*
Revenue from Operations came at Rs. 619.4 Cr (2.4% QoQ, -5.1% YoY) vs expectation of Rs. 632.4 Cr, QoQ Rs. 604.9 Cr, YoY Rs. 652.6 Cr
EBIDTA came at Rs. 47.8 Cr (-16.8% QoQ, -114.6% YoY) vs expectation of Rs. 81.9 Cr, QoQ Rs. 57.4 Cr, YoY Rs. -327.1 Cr
EBITDA Margin came at 7.7% vs expectation of 12.9%, QoQ 9.5%, YoY -50.1%
Adj. PAT came at Rs. 24.3 Cr vs expectation of Rs. 42.4 Cr, QoQ Rs. 26.4 Cr, YoY Rs. -209.2 Cr
Quarter EPS is Rs. 5.2
Share is trading at P/E of 11.1x FY22E EPS
*Minda Corp Q4FY21 Concall Update*
(Nirmal Bang Securities)
*Revival in 2 Wheeler demand remains the key monitorable*
*Outlook: Positive in long term*
• Revenue from Operations came at Rs. 794 Cr (+7% QoQ, +14% YoY).
• 2W OEMs (52% mix) performance remains the key going forward for Minda Corp. CV segment (13% mix) is expected to turnaround in FY22. PVs formed 11% mix & Tractors 8% mix.
• Most of the wiring harness is supplied to 2W and the least to Tractors & CVs.
• Although co’s most plants are operational; in month of May, almost 75% of dealerships are closed. Hence Q1 volumes will be severely impacted.
• Shortage of semi conductors is already impacting OEM supplies and needs to be monitored from a macro perspective.
• Diecasting revenues will continue to grow at 20-25%. Within diecasting, focus is on exports which has revenue of Rs. 110 Cr. This is likely to double in 3 years.
• Co will focus on developing new products catering to EV vehicles.
• Co will focus on exports. Exports segment won orders worth Rs 242 Cr (QoQ Rs. 224 Cr). Co will be applying for the Auto PLI scheme to drive exports and is in talks with its international JV partners.
• Started supplying keyless lock sets to export clients.
• EBITDA margins were at a 5 qtr high at 11.2% despite increase in raw material costs driven by operating leverage.
• Co is targeting 12% EBITDA margin in near term along with ROCE of 20%+
• Co has a share of atleast 50% with most of the customers for most of its products. In a few products, its share is 70-80% as well.
• No customer contributes more than 15% of revenue.
Stock is trading at P/E of 14.7x FY22E EPS
(Nirmal Bang Securities)
*Revival in 2 Wheeler demand remains the key monitorable*
*Outlook: Positive in long term*
• Revenue from Operations came at Rs. 794 Cr (+7% QoQ, +14% YoY).
• 2W OEMs (52% mix) performance remains the key going forward for Minda Corp. CV segment (13% mix) is expected to turnaround in FY22. PVs formed 11% mix & Tractors 8% mix.
• Most of the wiring harness is supplied to 2W and the least to Tractors & CVs.
• Although co’s most plants are operational; in month of May, almost 75% of dealerships are closed. Hence Q1 volumes will be severely impacted.
• Shortage of semi conductors is already impacting OEM supplies and needs to be monitored from a macro perspective.
• Diecasting revenues will continue to grow at 20-25%. Within diecasting, focus is on exports which has revenue of Rs. 110 Cr. This is likely to double in 3 years.
• Co will focus on developing new products catering to EV vehicles.
• Co will focus on exports. Exports segment won orders worth Rs 242 Cr (QoQ Rs. 224 Cr). Co will be applying for the Auto PLI scheme to drive exports and is in talks with its international JV partners.
• Started supplying keyless lock sets to export clients.
• EBITDA margins were at a 5 qtr high at 11.2% despite increase in raw material costs driven by operating leverage.
• Co is targeting 12% EBITDA margin in near term along with ROCE of 20%+
• Co has a share of atleast 50% with most of the customers for most of its products. In a few products, its share is 70-80% as well.
• No customer contributes more than 15% of revenue.
Stock is trading at P/E of 14.7x FY22E EPS
*Prism Johnson Ltd.* | *CMP* Rs. 144 | *M Cap* Rs. 7248 Cr | *52 W H/L* 144/29
(Nirmal Bang Retail Research)
*Result*
Revenue from Operations came at Rs. 1850.2 Cr (21.3% QoQ, 24.8% YoY) vs expectation of Rs. 1652.4 Cr, QoQ Rs. 1525.4 Cr, YoY Rs. 1483.1 Cr
EBIDTA came at Rs. 237.5 Cr (24.8% QoQ, 76.8% YoY) vs expectation of Rs. 231.4 Cr, QoQ Rs. 190.3 Cr, YoY Rs. 134.3 Cr
EBITDA Margin came at 12.8% vs expectation of 14%, QoQ 12.5%, YoY 9.1% (lower EBITDA margin as compared to Expected is on account of lower margin in Tiles business Cement margin seems to be in line)
Adj. PAT came at Rs. 143.8 Cr vs expectation of Rs. 78 Cr, QoQ Rs. 67.2 Cr, YoY Rs. -20.4 Cr (Higher PAT is on account of w/back of tax in current Quarter and loss last year was on account of higher Tax)
Quarter EPS is Rs. 2.9
Share is trading at EV/EBITDA of 9.1x FY22E EBITDA
(Nirmal Bang Retail Research)
*Result*
Revenue from Operations came at Rs. 1850.2 Cr (21.3% QoQ, 24.8% YoY) vs expectation of Rs. 1652.4 Cr, QoQ Rs. 1525.4 Cr, YoY Rs. 1483.1 Cr
EBIDTA came at Rs. 237.5 Cr (24.8% QoQ, 76.8% YoY) vs expectation of Rs. 231.4 Cr, QoQ Rs. 190.3 Cr, YoY Rs. 134.3 Cr
EBITDA Margin came at 12.8% vs expectation of 14%, QoQ 12.5%, YoY 9.1% (lower EBITDA margin as compared to Expected is on account of lower margin in Tiles business Cement margin seems to be in line)
Adj. PAT came at Rs. 143.8 Cr vs expectation of Rs. 78 Cr, QoQ Rs. 67.2 Cr, YoY Rs. -20.4 Cr (Higher PAT is on account of w/back of tax in current Quarter and loss last year was on account of higher Tax)
Quarter EPS is Rs. 2.9
Share is trading at EV/EBITDA of 9.1x FY22E EBITDA
Tech sell-off leads market to session lows with the Dow sliding 550 points
U.S. stocks fell sharply on Wednesday as massive selling returned to the tech sector amid a plunge in cryptocurrencies.
The Dow Jones Industrial Average fell 550 points, while the S&P 500 dropped 1.5%. The tech-heavy Nasdaq Composite slid 1.5% as Microsoft, Facebook, Alphabet and Apple all slid more than 1%
Sentiment in the tech sector was dented by a drop in cryptocurrencies including bitcoin. The world’s largest digital token plunged 30% at its low of the session to just above $30,000 according to Coin Metrics. Bitcoin has been cut in half since hitting an all-time high above $64,000 in mid-April. On Tuesday, China warned financial institutions not to conduct crypto-related business, possibly sparking the sell-off.
Tesla, a big holder of bitcoin, declined 4%. Microstrategy, another company which bought a large amount of bitcoin for its corporate treasury, tanked by 10%. Coinbase, the newly public crypto exchange, tumbled nearly 10%.
“There is no question that bitcoin has been the poster child for rampant market speculation and risk appetite,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “Thus, it should be absolutely monitored in gauging the pulse of risk taking, and now risk aversion.”
Growth stocks have come under pressure lately with the Nasdaq Composite falling nearly 5% in May as fears of inflation intensified. A sustained pickup in price pressures could unravel the Federal Reserve’s accommodative policies, which could hurt technology companies that have relied for years on easy borrowing costs for superior growth.
Cathie Wood’s flagship fund Ark Innovation ETF (ARKK) dropped more than 4%, bringing its 2021 losses to more than 18%.
“This was bound to happen at some point in ’21 and a somewhat of a reset in crypto-pricing is likely more healthy vs negative for the broader equity markets over time,” Jordan Klein, an analyst at Barclays, said in a note.
The Fed publishes the minutes from its April meeting later Wednesday afternoon, which could add to angst about inflation. The Fed kept its easy policies that meeting, but acknowledged that inflation could rise in coming months. The central bank maintains that these price pressures will be transitory.
“The major question for markets right now is whether the Fed is right and this increase in inflation is just temporary, because if inflation is not temporary, it could unleash a very painful period for virtually all investors,” Tom Essaye, founder of Sevens Report, said in a note.
Helping the sentiment a bit on Wednesday was better-than-expected results from Target. Shares of the major retailer popped by 3.8% after it said sales surged 23% last quarter.
Major stock indexes came off back-to-back losses weighed by weakness in the technology sector. Soft housing data on Tuesday partly triggered the broad selling in the previous session.
U.S. stocks fell sharply on Wednesday as massive selling returned to the tech sector amid a plunge in cryptocurrencies.
The Dow Jones Industrial Average fell 550 points, while the S&P 500 dropped 1.5%. The tech-heavy Nasdaq Composite slid 1.5% as Microsoft, Facebook, Alphabet and Apple all slid more than 1%
Sentiment in the tech sector was dented by a drop in cryptocurrencies including bitcoin. The world’s largest digital token plunged 30% at its low of the session to just above $30,000 according to Coin Metrics. Bitcoin has been cut in half since hitting an all-time high above $64,000 in mid-April. On Tuesday, China warned financial institutions not to conduct crypto-related business, possibly sparking the sell-off.
Tesla, a big holder of bitcoin, declined 4%. Microstrategy, another company which bought a large amount of bitcoin for its corporate treasury, tanked by 10%. Coinbase, the newly public crypto exchange, tumbled nearly 10%.
“There is no question that bitcoin has been the poster child for rampant market speculation and risk appetite,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “Thus, it should be absolutely monitored in gauging the pulse of risk taking, and now risk aversion.”
Growth stocks have come under pressure lately with the Nasdaq Composite falling nearly 5% in May as fears of inflation intensified. A sustained pickup in price pressures could unravel the Federal Reserve’s accommodative policies, which could hurt technology companies that have relied for years on easy borrowing costs for superior growth.
Cathie Wood’s flagship fund Ark Innovation ETF (ARKK) dropped more than 4%, bringing its 2021 losses to more than 18%.
“This was bound to happen at some point in ’21 and a somewhat of a reset in crypto-pricing is likely more healthy vs negative for the broader equity markets over time,” Jordan Klein, an analyst at Barclays, said in a note.
The Fed publishes the minutes from its April meeting later Wednesday afternoon, which could add to angst about inflation. The Fed kept its easy policies that meeting, but acknowledged that inflation could rise in coming months. The central bank maintains that these price pressures will be transitory.
“The major question for markets right now is whether the Fed is right and this increase in inflation is just temporary, because if inflation is not temporary, it could unleash a very painful period for virtually all investors,” Tom Essaye, founder of Sevens Report, said in a note.
Helping the sentiment a bit on Wednesday was better-than-expected results from Target. Shares of the major retailer popped by 3.8% after it said sales surged 23% last quarter.
Major stock indexes came off back-to-back losses weighed by weakness in the technology sector. Soft housing data on Tuesday partly triggered the broad selling in the previous session.