Breaking News: China Manufacturing PMI Falls Short of Expectations for July

The major U.S. stock indexes tumbled at the start of the week with the selling led by a steep drop in the technology sector for a third consecutive session.

In the cash market, the benchmark S&P 500 Index settled at 2802.60, down 16.22 or -0.58%. The blue chip Dow Jones Industrial Average finished at 25306.83, down 144.23 or -0.57% and the tech-driven NASDAQ Composite closed at 7630.20, down 107.13, down 1.38%.

Facing pressure in the NASDAQ Composite Index were shares of Facebook and Netflix, which lost 2.2 percent and 5.7 percent respectively. FANG stocks Amazon and Google-parent Alphabet fell 2.1 percent and 1.8 percent respectively.

The FANG stocks weren’t the biggest losers on Monday, however. Shares of Twitter dropped another 8 percent. It was followed by a 7.7 percent loss in Take-Two Interactive, a 5.7 percent decline in Electronic Arts and a 5.5 percent pullback in Akamai Technologies.

Earnings News

Caterpillar said in its second-quarter earnings report that recently imposed tariffs will shave off between $100 million and $200 million from its bottom line in the second half. The company also reported better-than-expected earnings and raised its full-year outlook, however.

Economic News

Reports were scare on Monday with U.S. Pending Home Sales coming in 0.9% higher versus an estimate of 0.4%. It also reversed last month’s 0.5% decline.

Rattling investors, however, was a report by Reuters that Canada, the European Union, Japan, Mexico and South Korea will meet next week to discuss a response to threats made by President Donald Trump about slapping tariffs on U.S. auto imports.

Tuesday’s Early Reports

In breaking news, China reported on Tuesday that factory activity was slightly lower than expected in July, with the official manufacturing Purchasing Manager’s Index (PMI) coming in at 51.2

The Chinese manufacturing PMI had been forecast to fall to 51.3 in July from 51.5 in June, according to a poll of economists by Reuters.

China’s official services PMI also fell in July. The report showed a reading of 54.0 from 55.0 in June.

In Japan, the unemployment rate rose to 2.4%, versus a 2.3% estimate and 2.2% previous read. Preliminary Industrial Production fell by 2.1%, worse than the -0.3% forecast and -0.2% previous read.

In New Zealand, Building Consents fell 7.6% versus a 6.9% previous report. ANZ Business Confidence was -44.9. Last month the report was -39.0.

Australian Building Approvals jumped 6.4% versus a 1.1% estimate. However, the previous month was revised lower by 2.5%. Private Sector Credit hit the estimate of 0.3%, slightly better than last month’s 0.2%.

Social-Media Giant Facebook No Concern for True Technology Investors

Last Thursday’s “gap and go” sell-off in Facebook was ugly for long investors but it should only serve as a reminder of what could happen to any stock at any time, not just this social media giant. Furthermore, it should not be used as an indicator “of things to come” for the FANG stocks or the entire technology sector.

Sure, it could happen in other technology stocks because investors are loaded up on the long side in these stocks because for years, they have been the best game in town. So far this year, the tech-based NASDAQ Composite is up 12.1%, while the benchmark S&P 500 is up 5.4% and the blue-chip Dow Jones Industrial Average has posted a 3.0% gain.

Every time a revenue and earnings report is posted, investors run the risk that a company will miss on both sides, triggering a mass exit from the stock on profit-taking. Yes, profit-taking, not fresh short selling. That’s why savvy investors diversify their holdings.

Investors in a bull market are constantly looking for value. Some see higher prices in the future and decide to buy now in anticipation of higher prices. Some play for value and prefer to buy dips. With Facebook, investors perceived the stock as overvalued based on future growth projections so they took a little off the top.

The size of the sell-off was obviously a headlines grabber, but you have to look at who was behind the selling. It wasn’t mom and pop investors, nor was it all mutual fund sellers. They may have booked profits when the bad news came out, but the majority of the selling took place during the over hours market and it was primarily dominated by the over-weighted hedge funds.

According to a recent survey by Goldman Sachs, more than 10 percent of hedge funds counted Facebook as a top 10 holding.

The hedge funds were in massive long positions based on first-quarter regulatory filings. This was in contrast to the mutual funds, which have reportedly been trimming their positions in so-called FANG stocks since late 2016, the Goldman report said on Thursday.

In other words, the mutual funds were hit less-hard from the Facebook debacle than the highly speculative hedge funds.


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Contagion Effect?

Firstly, let’s look at the weightings of the FAANG stocks – Facebook, Amazon, Apple, Netflix and Google (Alphabet) – in the NASDAQ Composite Index. Facebook is weighted 4.983 percent, Amazon 10.475 percent, Apple is 11.151 percent, Netflix is 1.834 percent and Google (Alphabet) is 5.134 percent.

It may be top-weighted in Amazon and Apple, but the others seem to be fine. A sell-off equal to Facebook’s move will, therefore, have a greater effect on the index then Thursday’s move in the social media giant. So the 1.06% loss in the index last week was relatively small when compared to, for example, the steep break in February.

Secondly, analysts are now saying that Amazon is beginning to decouple from the FAANGs. Remember that Amazon released earnings the day after Facebook. Although they were mixed, the stock still rose so there goes the contagion argument.

It looks like the contagion argument may be valid for Facebook and Twitter since both sold off sharply last week and they are both social media companies. However, given the history of the social media sub-sector (see AOL and Myspace), this can be a volatile group of stocks. It is truly an “only the strong survive” industry.

In conclusion, I have to say that based on the second-quarter earnings results, the technology sector is fine and should before well the rest of the year even with the “blip” on the chart from Facebook. As of Friday, earnings from more than half of the companies in the S&P 500 Index have reported, and so far 88% beat on earnings while 74% had better-than-expected revenue. Furthermore, technology stocks continue to look good, with 35 of 36 companies beating on the bottom line.

So when it comes to assessing the value of an entire sector, try not to get caught up in the headlines about how money was lost, and the historical size of the crash, keep an eye on the entire sector. Furthermore, if money leaves Facebook, a social media company, it may flow into other stocks in the sector including Microsoft, Apple, Netflix or Amazon.

What To Expect Ahead of A Busy Earnings Week?

Major U.S Benchmark indices finished the week on the red as investors reacted to mixed earnings reports. Alphabet Inc. (NASDAQ: GOOGL) and Amazon.com, Inc. (NASDAQ: AMZN) led the foray in beating earnings estimates as Facebook, Inc. (NASDAQ: FB) Imploded on missing estimates and providing guidance that fell short of expectations.

It yet again promises to be a busy week as a string of high profile companies is expected to post their quarterly earnings results.

Earnings Report expectations

Apple Inc. (NASDAQ: AAPL)

In the wake of Google and Amazon beating estimates, focus this week shifts towards Apple Inc. (NASDAQ: AAPL) given the amount of market cap it commands. The iPhone maker is to post its second earnings report after market close on July 31, 2018.  Analysts expect the company to post revenue of $61.14 billion representing a 15% year-over-year increase. Earnings per share, on the other hand, are projected at $2.16 a share.

Wall Street will also pay close attention to the number of iPhones the company sold in the second quarter, after a disappointing first quarter whereby unit sales rose by only 1.5 million. In the March quarter, service revenue rose 31% to $9.19 billion thereby helping the company beat sales and EPS expectations.

For the June quarter, Wall Street expects service revenue to come in at $9.21 billion representing a 21% increase. Investors will also pay close attention to other products sales made up of headphones, Apple TV Set-tops, as well as Apple Watch. Expectations are that the company will report a 34% increase in revenues in this segment at $3.68 billion.

Tesla Inc. (NASDAQ: TSLA)

Tesla Inc. (NASDAQ: TSLA) needs to post stellar second-quarter earnings report to avert a further implosion of the stock. After initially rising to highs of $373 a share, the stock has come down tumbling to below the $300 share mark.

Tesla reports on August 1, 2018, having achieved a significant milestone in the production of 5,000 Model 3s, a week. However, the company is expected to report a net loss of $3.49 a share. Investors will focus their attention on the number of Model 3 units the company delivered in the quarter.

The expectation is high that the company did deliver 10,000 more units in Q2 compared to Q1. Revenue, on the other hand, is expected at $4 billion on the sale of the additional cars. Attention will also be on the company’s expenditure, a headwind that has clobbered the company for years preventing it from turning in a profit.

Q3 Guidance will also have to come overboard to prevent further slide of the stock. Given that the company has hit 5,000 a week production milestone investors expect the company to provide a pathway to profitability in Q3.

Caterpillar Inc. (NYSE: CAT)

Caterpillar Inc. (NYSE: CAT) will report its earnings report on July 30, 2018, before the earnings bell. After delivering a 120% year-over-year improvement in earnings in Q1, expectations are high that the trajectory continued in Q2.  Investors expect the company to report a 22% increase in total sales, projected at $13.8 billion.

Earnings per share, on the other hand, should tickle in at $2.66 a share, representing a 79% year-over-year increase. The earnings beat is what Caterpillar needs if the stock is to bounce back after underperforming the market in the first half of the year.

Loews Corporation (NYSE: L)

Just like Caterpillar, Loews Corporation (NYSE: L) is scheduled to report on July 30, 2018, before the market opens. In Q1, the company reported a 14% surprise earnings beat. Expectations are high that the company beat estimates in Q2 on the strong performance of its CAN financials and Loews Hotels units Consensus estimates indicate the company could post earnings of 0.73 cents a share representing 3.9% year-over-year decrease.

AK Steel Holding Corporation (NYSE: AKS)

AK Steel Holding Corporation (NYSE: AKS) will report earnings on July 30, 2018, with expectations high that the company will beat estimates. The stock has already broken out of a critical resistance level in the wake of other steel companies reporting stellar quarterly financial results.

The consensus forecast for the quarter is that the company will report earnings of 23 cents a share, an increase from 19 cents a share reported a year earlier. Steel stocks are expected to continue powering high, the sector has emerged as a bright spot in the economy.

Procter & Gamble Co (NYSE: PG)

The owner of blockbuster brands like Gillett Razors and Pampers Diapers, Procter & Gamble Co (NYSE: PG) is to report its fourth-quarter and full year financial results on July 31, 2018. At the start of the year, the company forecasted organic sales gains of 2.5% up from an initial estimate of 2%.

For the current quarter, Wall Street expects the company to report revenues of $16.55 billion. Full-year sales, on the other hand, are expected at $66.87 billion. Investors will also want to hear what the company is doing as part of its cost-cutting drive. Cost cuts are expected to allow the company to venture into other growth areas.

Pfizer Inc. (NYSE: PFE)

Pharmaceutical giant Pfizer Inc. (NYSE: PFE) is to report its second-quarter earnings report before market open on July 31, 2018. The focus will be on whether the company maintained the positive earning streak in the quarter, after a positive earnings surprise of 4.05% in Q1.

Consensus estimates indicate the company could report EPS of $0.74 a share on revenues of $13.31 billion.

DowDuPont Inc. (NYSE: DWDP)

DowDuPont Inc. (NYSE: DWDP) is to report its recent quarterly earnings on August 2, 2018, before market open. Last year same quarter, the company reported earnings per share of $1.12, beating analyst’s expectations of $1.1 share. For the current quarter, investors expect the company to post EPS of $1.3 a share. Revenues, on the other hand, should come in at $23.6 billion.

Baidu Inc. (ADR) (NASDAQ: BIDU)

Investor’s sentiments are high on Chinese internet giant Baidu Inc. (ADR) (NASDAQ: BIDU) posting impressive quarterly results after the market close on July 31, 2018. Consensus estimates indicate the company could post a 30.2% year over year increase in sales that could come in at $4.01 billion. For the full year, the search giant is expected to post sales of $16.09 billion. Analysts expect the company to issue a sales guidance of $19.46 billion for next year.

Sprint Corp (NYSE: S)

Sprint Corp (NYSE: S) is to report its Q1 financial results on July 30, 2018. Wall Street expects the company to report earnings per share of $0.01 a share compared to $0.05 reported last year. Total revenue is poised to decline 0.7% year over year to $8.1 billion.

Teva Pharmaceutical Industries Ltd (ADR) ADR (NYSE: TEVA)

Teva Pharmaceutical Industries Ltd (ADR) ADR (NYSE: TEVA) is to report on its recent quarterly earnings report before the market opens on August 2nd, 2018. The expectation is high that the company will post sales of $4.75 billion down from $5.69 billion reported last year. Earnings per share, on the other hand, should come in at $0.67 a share.

Shake Shack Inc. (NYSE: SHAK)

Shake Shack Inc. (NYSE: SHAK) is expected to post sales of $110.20 million for the recent quarter after market close on August 2, 2018. Earnings per share are expected at $0.17 a share. The company is also expected to maintain full-year sales estimates of $451.32 million.

Kraft Heinz Co (NASDAQ: KHC)

Kraft Heinz Co (NASDAQ: KHC) will report earnings before markets open on August 3, 2018. Investors expect the company to post EPS of $0.92 a share up from $0.89 a share reported in the previous quarter. Revenue, on the other hand, is expected at $6.59 billion.

What’s Next for Tech Stocks?

In the last week, Facebook Inc. grabbed the headlines once more and once again for all the wrong reasons, with Facebook’s market cap tumbling by over $100bn to sit just above $500bn, as Facebook shares slumped 19%, the market cap collapse being the largest in U.S market history, outdoing Intel’s $90bn tumble in the bubble bursting end of the dotcom era.

Tech Stocks Contagion

FAANG has taken the headlines by storm ever since the U.S equity market rally began, largely in response to the U.S Presidential Election result back in late 2016 and members of the FAANG group have certainly been a major influence in the direction of the broader tech sector and the major U.S and global indexes.

Facebook, Amazon, Apple, Netflix, and Google make up the grouping and the 5-stocks, alongside a more seasoned Microsoft, have continued to ultimately direct the tech sector, not just in the U.S, but also in Asia, where listed companies have significant reliance as a result of partnerships or sales revenues from one of the FANG Members.

Tech stocks have felt the contagion effect that has also weighed on the broader sector and indexes heavily weighted towards the tech sector. The supplier to Apple for instance also has a supplier and in there lies the contagion.

Facebook has faced a tumultuous time of late and, while there was some heavy fallout following the Facebook – Cambridge data scandal that certainly raises many questions over the future of social media platforms as we know it today, it was Facebook’s bread and butter ad revenue and user forecasts attributed to the data scandal that did the damage.

Facebook’s slide and influence across the broader market should perhaps be of greater concern to the U.S government, regulators and governments worldwide than the cryptomarket and future of blockchain technology.

With regulators and government groups tasked with assessing the broader cryptomarket reporting it poses little to no threat to the global financial markets, FAANG members are quite the opposite, with a vast majority of household portfolios holding one, if not all 5 stocks.

No doubt there have been some solid gains enjoyed by many, but at some point, what goes up must come down and as the tides of time shift, sentiment towards a certain platform can also shift and Cambridge Analytics contributed, though whether it’s the end of Facebook remains to be soon.

At the end of the day, while Facebook saw the biggest market cap slide in market history, long-term investors wouldn’t be at fault for missing the 20% share price slide when simply viewing the stock’s 52-week range, with Facebook Inc. still up 17.4% from its 52-week low $149.02.

Whether that brings complacency near-term, investors possibly viewing the stock as being simply 20% cheaper remains to be seen, but it wasn’t long ago that Google faced the wrath of EU regulators, with a fine more akin to the size of fines that European banks coughed up to U.S regulators off the back of breaches to SEC rules and regulations.

While U.S regulators have earned their crust fining European banks by hefty sums since the Global Financial Crisis, European regulators have found a way to hit back and that’s never going to be a good thing for an already fragile sector.

Trade War – Can It Hurt Tech Stocks?

If there was a time when the markets would have preferred the U.S president to let things be, the added attention from Trump and the administration on the tech sector and China’s reported interest and access to U.S tech companies has been another issue faced by investors favouring a sector that has certainly seen a solid run over almost 2-years.

Trump’s trade war with China has left the tech sector heavily exposed and the decision by the U.S to refute China Mobile’s request for entry into the U.S, which comes in the wake of U.S hitting China’s ZTE with sanctions that almost buried one of China’s largest tech companies, has only added to the pressure faced by tech companies.

Tariffs on Chinese goods and expectations of a technology decoupling between U.S and China tech companies is a factor that will add to the pressure. Trump has cited national security as the main reason behind the shift in attitude towards China’s tech companies and to be fair, foreign ownership in anything tech related, particularly the telecoms, should be an issue for any nation and national security and even more so when considering the fact that the cost of cybercrime is estimated to hit $6bn by 2021, quite a jump from $3bn in 2016.

The U.S has plenty to be concerned when considering the fact that both China and Russia share 3rd position behind the U.S and Israel, on best offensive cyber capabilities, the irony being that it was at Russia’s hand that Trump managed to squeeze past Clinton on his way into the Oval Office. Ironically, tech stocks might be a crucial part for a solid national cyber warfare.

Will Twitter and Facebook recover?

With so much uncertainty and sky-high valuations amongst the FAANG stocks, Apple Inc. is in focus this week, with its earnings results due out after the market close on Tuesday 31st July, with Apple Inc. enjoying a consensus buy recommendation ahead of the earnings, based on revenue EPS forecasts.

Not too dissimilar to Facebook and even Twitter, which plunged 20.54% on Friday, in response to a reported slide in monthly users, with warnings of more declines to come in the coming months weighing on investor sentiment, Twitter user numbers have been key to valuing the company and not the platform itself.

Looking away from Social media and stocks that have a heavy reliance on FAANG earnings and growth potential certainly looks to be the way forward for now and, with the trade war showing few signs of coming to an end, tech stocks with a heavy reliance on China, either as a sales market or as a supplier may also need to be carefully considered with the bias towards the negative until there is some resolution to the ongoing trade war.

Social media platforms are beginning to lose popularity at the pace at which they rose in the early years and, while there may be some support from the sheer volume of users, the market’s choice of Facebook and other FAANG members as the tech sector’s barometer may well need to change sooner rather than later.

Early U.S. Trade: Stock Futures Higher After Mixed Amazon Earnings, Ahead of U.S. GDP Report

Asian stocks are trading higher early Friday. The Australian index is posting the largest gain and the Hong Kong Index is marginally lower.

At 0326 GMT, Japan’s NIKKEI is at 22635.59, up 48.72 or +0.22%. The Hong Kong HIS is at 28775.21, down 5.93 or -0.02%. In Australia, the S&P/ASX 200 is 6294.30, up 49.80 or +0.80%. China’s Shanghai Index is trading 2884.93, up 2.70 or +0.09% and the South Korean KOSPI is at 2292.45, up 3.39 or +0.15%.

The NIKKEi’s gains are being limited by weakness in the securities brokerage sector after Nomura reported net profit in the second quarter fell to 5.2 billion yen ($46.8 million), compared to 56.9 billion yen one year ago.

In Australia, stocks are advancing on the back of a strong performance in the technology subindex. In Hong Kong, the Hang Seng Index is being pressured by weakness in the material sector. China’s Shanghai Composite and Shenzhen Composite are trading higher after earlier weakness.

U.S. Stock Market

The major U.S. stock indexes are trading slightly better during Friday’s early futures session. This follows a mixed performance on Thursday which was highlighted by a steep drop in the NASDAQ Composite. Early volume is light as investors position themselves ahead of today’s U.S. second quarter Gross Domestic Product report that is due to be released at 1230 GMT.

After the close, Amazon reported mixed results for its second-quarter earnings. Earnings blew away the estimates, but revenue narrowly missed to the downside. Third-quarter sales guidance also fell short of street estimates. Despite the mixed results, shares of Amazon were trading about 3 percent higher during the extended trading session.

On Thursday, the technology sector took a beating after Facebook reported a miss in second-quarter revenue following Wednesday’s close. Shares of the social media giant plunged 18.96 percent, posting their worst performance ever, on the back of those disappointing results.

The weakness in Facebook helped the NASDAQ Composite record its worst day in around a month, falling 1.01 percent to 7852.19. The Dow posted a solid gain on the back of easing trade tensions between the United States and the European Union. The S&P 500 Index was also higher for the same reason, but gains were limited by the weak performance in the technology sector.

U.S. Economic News

The U.S. Commerce Department said on Thursday that orders for non-defense capital goods excluding aircraft, rose 0.6 percent last month. Data for May was revised to show the so-called core capital goods orders increasing 0.7 percent instead of the previously reported 0.3 percent gain. Economists had forecast core capital goods rising 0.4 percent last month. Core capital goods orders increased 6.8 percent on a year-on-year basis.

Weekly Unemployment Claims came in at 217K, slightly above the 215K estimate. Last week’s report came in at 208K.

The Goods Trade Balance was higher than expected at -68.3 Billion, versus an estimate of -67.08 Billion. The previous month was -64.8 Billion.

Facebook Plunge Dragging NASDAQ Lower, Easing of Trade Tensions With Europe Boosting Dow Industrials

The major U.S. stock indexes are trading mixed on Friday, reflecting their exposure to the technology sector and the easing of trade tensions between the United States and the European Union.

The main driver of the price action in the technology sector on Thursday is Facebook. The social media giant represents about 6.026 percent of the NASDAQ Composite Index. Shortly after the cash market opening, it is on pace for its worst one day performance in its history, down over 20 percent on a Q2 revenue miss and disappointing daily active user count.

After the initial news broke on Thursday, shares of Facebook lost about $120 billion in market value while dragging the rest of the technology sector lower. The so-called FAANG stocks – Facebook, Apple, Amazon, Netflix and Google (Alphabet) are also under pressure today on profit-taking. Amazon is set to release its earnings and revenue figures after the close today.

While the NASDAQ Composite is being weighed down by its exposure to technology stocks, Dow stocks are celebrating the easing of tensions over the U.S. trade dispute with the European Union. Shortly after the U.S. cash market opening, the Dow Jones Industrial Average is up over 100 points.

On Wednesday, President Trump announced that the U.S. and the European Union had initiated a “new phase” within their relationship, explaining how both regions would start collaborating in order to lower tariffs and avoid a potential trade war.

Dow components that were beat down during the height of the trade dispute crisis with Europe are roaring back on Thursday. Shares of Caterpillar are up about 0.8 percent. 3M, another company with large overseas revenue exposure, also rose about 1.4 percent.

Amazon Earnings

After the closing bell on Thursday, Amazon is expected to report a jump in profits when it reports second-quarter earnings on Thursday evening. Fueling the surge is expected to be continued growth of its higher-margin businesses, like cloud, advertising and third-party marketplace.

Analysts estimate Amazon will post second-quarter profits of $2.50 per share, or roughly $1.2 billion, according to a Thomson Reuters consensus estimate, up from the 40 cents per share reported a year earlier.

U.S. Economic Data

According to a U.S. government report, new orders for key U.S.-made capital goods increased more than expected in June and shipments surged, pointing to solid growth in business spending on equipment in the second quarter.

The Commerce Department said on Thursday that orders for non-defense capital goods excluding aircraft, rose 0.6 percent last month. Economists had forecast core capital goods orders rising 0.4 percent last month. The report also showed core capital goods orders increased 6.8 percent on a year-on-year basis.

Data for May was revised higher to show the so-called core capital goods orders increasing 0.7 percent instead of the previously reported 0.3 percent gain.

Energy Complex

U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading higher on Thursday, rising in reaction to the news that Saudi Arabia suspended its oil shipments through a key Red Sea strait in response to an attack on two of its tankers.

Natural gas futures surged early Thursday after government storage data came in lower than expected. According to the U.S. Energy Information Administration, weekly natural gas in the U.S. rose by 24 billion cubic feet (bcf) in the week-ended July 20, below the estimate of 39 billion cubic feet.

Tech Stocks Under Pressure After Facebook Earnings Miss Fuels $125 Billion Loss in Market Value

The major U.S. equity markets are trading lower early Thursday following a strong performance on Wall Street the previous session. The selling pressure is being led by weakness in the technology sector.

At 0235 GMT, the tech-driven September E-mini NASDAQ-100 Index futures contract is down 60.25, or -0.80% at 7408.25. The benchmark September E-mini S&P 500 Index futures contract is at 2835.25, down 6.00 or -0.21% and the blue-chip Dow Jones Industrial Average futures contract is trading 25416, down 34 or -0.13%.

After the bell, disappointing quarterly earnings results from Facebook led to a major decline in after-hour trade. Given the early move, the company is on track to lose more than $125 billion in market value. This represents about a fifth of its value.

Other big technology stocks are also getting hit by a wave of selling pressure. Apple lost about 1 percent. Amazon, which reports after the bell Thursday, lost 2.3 percent. Netflix, which disappointed investors last week, was down about 3 percent in after-hours. Finally, Google parent Alphabet fell 2.4 percent.

Facebook competitors, Twitter and Snap also felt the wrath of sellers. Both lost 4 percent after hours Wednesday.

Triggering the steep drop in Facebook was weaker-than-expected daily active users for last quarter and guidance that said revenue growth would decline sequentially in the second half of this year. Chief Financial Officer David Wehner said shareholders can expect “revenue growth rates to decline by high-single-digit percentages from prior quarters” for the third and fourth quarter.

The Facebook news came as a huge supplies to investors, many of whom stayed long into the report after the NASDAQ Composite Index hit a record during trading Wednesday as investors crowded back into the FANG names once again.

Trump, EU Meeting

The key meeting between U.S. President Donald Trump and European Commission President Jean-Claude Juncker went well on Wednesday with the announcement that they had launched a “new phase” in their relationship.

President Trump said that the two major economies would start negotiations immediately on a number of areas that include working toward “zero tariffs” on industrial goods, and further cooperation on energy issues.

“We agreed today, first of all, to work together towards zero tariffs, zero non-tariff barriers and zero subsidies for the non-auto industrial goods,” Trump said.

Juncker went on to say that the two leaders also agreed that as long as negotiations were ongoing, “we’ll hold off further tariffs and reassess existing tariffs on steel and aluminum” put in place by the Trump administration. “This was a good, constructive meeting,” he added.

U.S. Housing Market Developments

Two key stories stood out on Wednesday. Firstly, according to CoreLogic, southern California home sales hit the brakes in June, falling to the lowest reading for the month in four years. Sales of both new and existing houses and condominiums dropped 11.8 percent year over year, as prices shot up to a record high.

Sales fell 1.1 percent compared with May, but the average change from May to June, going back to 1988, is a 6 percent gain. The report also said that the weakness was especially apparent in sales of newly built homes, which were 47 percent below the June average. Part of that is that builders are putting up fewer homes, so there is simply less to sell.

Secondly, sales of new U.S. single-family homes fell to an eight-month low in June and data for the prior month was revised sharply down, the latest indications that the housing market was slowing down.

According to the U.S. Commerce Department, new home sales dropped 5.3 percent to a seasonally adjusted annual rate of 631,000 units last month, the lowest level since October 2017. May’s sales pace was revised down to 666,000 units from the previously reported 689,000 units.

Traders and economists were looking for new home sales to fall about 2.8 percent to a pace of 670,000 units in June.

Stocks are Growing while Bonds Under Pressure

The situation in the world markets looks controversial. Shares are growing after strong reporting of companies. The shares of Alphabet (#Google) jumped by 3.6% after the market closed on Monday, bringing capitalization of the company to $870 billion on strong quarterly reporting, despite a big fine imposed by the EU. By capitalizing the search engine giant is at a striking distance of Amazon, the 2nd most valuable company after Apple.

In Asia, positive stocks dynamics is supported by news that Beijing will soften the fiscal policy, intending to spur the growth of the economy. The factor of positive dynamics of China looks strong in the short term, probably supporting the demand for risks at the start of trading on Tuesday.

In the calculation for a longer perspective, it is worth paying attention to the yields growth on debt markets and strengthening of safe-haven currencies. In the global market, the dollar grew on Monday, adding 0.3% against the backdrop of fears that the central Bank of Japan and the Eurozone would give up incentives at the time when world growth became less synchronous and robust. These fears fuel the sale of bonds, causing the yields increase.

This is a precondition for a dangerous situation. Bilateral trade tariffs additionally stimulate inflation, which is already close to the target levels or slightly exceeds them in some countries. The lowest unemployment rate in the decade will only accelerate this process.


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At the same time, fears around trade wars harm economic growth, which already shows a slowdown. As a result, global growth is becoming more fragile and less able to survive the tightening of monetary policy. In addition, high inflation will limit the ability of the CBs to stimulate growth.

This article was written by FxPro

Don’t Look Now, but Stocks Could Finish Lower This Week

U.S. equity markets are trading lower on Thursday. Although the newswires haven’t centered on the reason for today’s weakness, I suspect they’ll have some reason by the end of the day.

From the headlines throughout the week, at a glance, one would think the stock markets have been booming this week. However, looking at today’s early price action, you’ll see the NASDAQ Composite trading lower for the week after striking a new all-time high just a few days ago. The benchmark S&P 500 Index and the blue-chip Dow Jones Industrial Average are both in a position to turn lower for the week.

It’s only Thursday, but a lower close for the week in all three major indexes will speak volumes and may even be an indication that we’ve hit our summer highs. A top this early in the second quarter earnings season will definitely come as a surprise since investors have high expectations for this earnings season. According to analysts polled by FactSet, the crowd is expecting to see 20 percent year-over-year profit growth for the second quarter.

However, you have to remember that earnings and revenue reports represent the past and stock prices are supposed to be discounting future events. So while it’s nice to see stocks rallying, across the board weakness in the major indexes should be viewed as a red flag. And with recent data showing money flowing into Index ETFs, investors should be concerned about this week’s price action.

One has to question how much diversification is out there, and one has to worry about how much overlap exists in all these ETFs. Some say that if it wasn’t for the FANG stocks – Facebook, Amazon, Netflix and Google-parent Alphabet, the NASDAQ wouldn’t be performing near as well as it has this year.

We saw earlier this week how fragile the indexes are when Netflix earnings report showed a drop in subscriptions on the same day that Amazon had a glitch in its computer systems in one of its busiest days of the week. Although the sell-off in response to these two events was quick and decisive, it did open the door to the thought of what could happen if all four FANG stocks decided to turn lower at the same time.

We should learn more about how strong or how fragile the stock market is when Amazon releases its earnings and revenue results next week. In the meantime, investors should pay attention to Friday’s close because a lower close may tell us that it may be time to start getting defensive about the stock market.


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While it’s always nice to think about the upside potential of the stock market, it’s equally important to think about the downside risk. Is it possible that investors have been so mesmerized by the quest for $1 trillion in market valuation by Amazon, Apple or Microsoft that investors have forgotten about downside exposure? We could soon find out.

Getting back to the reason for today’s weakness, it could be a combination of events including disappointing earnings, worries over prolonged trade disputes or even Fed Chair Powell’s hawkish talk about rising interest rates. Whatever the reason, keep an eye on Friday’s close because how the market finishes this week may send out an important signal about the status of the market at current price levels.

Best Deals – Amazon Prime Day

The Amazon prime day starts today, and it’s a big day for online shoppers. The 36 hours of sale starts today, July 16, at 3 pm ET. 17 countries will be part of this massive sale which includes the US, UK, Spain, Mexico, Japan, India, Italy, Germany, France, China, Canda, Belgium, Austria and the new joiners that include the Netherlands, Singapore, Australia, and Luxemburg.

So, the big question, what can you buy on Amazon Prime day and what are the best deals?

The Echo Products

Those products are part of Amazon own devices and will be offered at their lowest prices. The Echo show will be offered at $129, $100 discount from its original price. The Echo Dot (2nd generation) will cost $15 less than its price of $29. On Prime day, all the Echo spot products are offered at a subsequential discount.

Fire Products

The Fire products are also part of Amazon devices and for those who had any intention to buy these products, the prime day is a great opportunity. The Fire TV stick – $19.99 ($20 off), Fire 7 Tablet – $29.99 ($20 off), Fire TV Cube – $199.99, ($40 off), Fire HD 10 Kids Tablet – $299.99 ($100 off).

TV Best Deals

Amazon offers the TCL 49-inch 4K Smart Roku for $399.99 ($200 off), and the TCL 55-inch 4K Roku Smart TV for $584 ($215 off).

You can also purchase the Toshiba 43-inch 4K Smart TV for $329.

Mobile and SmartPhones

Amazon offers the Moto G6 on Prime day for $259.99 ($100 off). The Huawei Mate 10 Pro will cost $500 on Prime day, a discount of $85.

Amazon will also offer mobile accessories at low-cost compared to its regular prices.

Home Accessories Products

Amazon Prime day is not only about tech products but also home and accessories, all of those small things we need.

The Ultimate Ears WonderBoom Bluetooth speaker will cost $49.99 ($50 off), the Gtech Pro Bagged Cordless vacuum cleaner which on a normal day cost $275.98, on Prime day will be sold for $149.

The Oral B Genius Cross action Electric, $79.99 ($62 off). The Belkin 12 Port Surge Protector for $15.19 ($36 off).

What Do You need to Shop on Prime Day?

Obviously, you need to be an Amazon Prime member, it’s not a complicated process but we recommend to do it before the sale starts. The prime rate annual fee is $119 but Amazon also provides you with a free trial.

Investors Should Be Watching Guidance During This Earnings Season

Earnings season kicked-off on Tuesday with concerns over the lingering trade dispute between the United States and its trading partners in China and the European Union, taking a backseat, at least temporarily.

According to FactSet, S&P 500 second-quarter earnings are expected to grow by 20 percent. This would put them in a position to challenge the 24 percent jump reported during the first calendar quarter.

On Monday, the first day back from the extended Independence Day holiday, the blue chip Dow Jones Industrial Average posted a more than 300 point gain, mostly on the back of a strong financial sector, led by bank stocks.

It’s fitting that the banks finished the strongest because they benefit the most from a rising interest rate environment.

Today’s price action is being drive early by the results of more than 20 companies in the S&P 500 Index. The surprise of the day so far has been the results of PepsiCo. The soft drink and snacks manufacturer posted better-than-expected earnings, sending its shares higher by more than 2 percent. PepsiCo also provided positive guidance, saying it expects “substantially higher” earnings growth for fiscal fourth quarter.

While Pepsi came out hot right from the box this morning, other companies should be overlooked. According to The Earnings Scout CEO Nick Raich, 86 percent of the companies that have already reported exceeded their quarterly earnings expectations, posting 24.08 percent year-over-year growth.

Raich said, “Those are phenomenal numbers, but as we said they do not matter for current stock prices.” “This is why we are looking at the changes in earnings estimates after companies report and comparing them to prior periods to determine if the underlying trend in profit expectations can stay on an improving path.”

This is a very important point because earnings actually represent stale data. They represent the earnings from last quarter. The third and fourth quarter results will be the first during the period of full tariffs from the U.S. on Chinese goods and the retaliatory tariffs on U.S. goods from China. They will tell the actual story about the impact of the tariffs on company earnings.


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So at this time, investors should be looking beyond last quarter earnings and at any guidance from companies that mention the impact of the tariffs. It is possible that the market may not have fully priced in the possibility of a full-blown trade war just yet.

We do know from the way the three major indexes have performed that there have been asset allocation plays going on in the market. We also know that the weightings of the indexes have had a major influence on their performances so far this year.

The NASDAQ Composite, for example, faces little exposure to the tariffs, so it is up substantially this year and threatening a new all-time high this morning. The Dow Jones Industrial Average, however, is being weighed down by several stocks that face exposure from tariffs. The Dow is trading barely higher this year.

If the market begins to fully price in the impact of the tariffs then the Dow is likely to turn negative for the year, followed closely by the S&P 500 Index. Investors shouldn’t wait for third or fourth quarter earnings to tell them to bailout of certain stocks. They should be watching the future guidance during this current earnings season.

10 Places Where You Can Use Bitcoin, Online and Offline

Acceptance and widespread adoption has seen Bitcoin evolve from being a domain of the tech-savvy to being a preferred means of settling transactions around the world. Amidst restriction in the usage of the digital currency in some jurisdiction, e-commerce platforms have taken the lead in accepting bitcoin payments as a way of addressing customer needs.

Places To Spend Bitcoin Online

Online Shopping: Overstock

For those who like doing online shopping, Overstock is the place to be as the online retailer was among the first to add support for bitcoin payments.  With a simple click of a button, you should be able to pay for everything, right from electronics to furniture, jewelry, bedding using Bitcoin holdings.

In addition to Bitcoin, the e-commerce retailer also allows customers to make payments using other cryptocurrencies in the name of Ethereum, Dash and Bitcoin Cash. To use cryptocurrency in the e-commerce site, you have to transfer your preferred virtual currency, and the system will do the conversion automatically.

Making Travel Arrangements: Expedia, CheapAir, SurfAir Virgin Galactic, AirBaltic, Webjet

For those always on the go, Expedia is the site to visit when planning to make travel arrangements. The online travel agency allows visitors to pay for hotel bookings using Bitcoins. However, Bitcoin can only be used to pay for Hotel Bookings.

In case you wish to book air tickets with Bitcoin then CheapAir and Surf Air are some of the sites to visit. Once you chose all your flights, CheapAir will provide payment options of which Bitcoin is one of them.  The site accepts bitcoin payments for both domestic and international flight.

AirBaltic and Webjet also accept bitcoin payments for a variety of flights as well as for hotel, cruises and car hire.

Virgin Galactic allows people with a loftier bitcoin holding to pay for space travel.

Buy Gift Cards: eGifter and Gyft

EGifter and Gyft have beaten the likes of Amazon and Best Buy on the integration of Bitcoin payments for Gift Cards. You can use Bitcoin in these two sites to buy gift cards and then redeem them in hundreds of other popular retailers Including Amazon and Best Buy.

Games and Movies Purchases:  Microsoft

Microsoft is among the very few tech giants that seem to have embraced cryptocurrency as a form of payment. The software giant allows customers to deposit bitcoin into their Microsoft accounts to be to buy games, movies, and apps in Windows and Xbox Store.

The service should be of great benefit to the movie and game lovers. Microsoft could take the service to another level by accepting such payments in its online store.

In addition to Xbox, you can also purchase Zynga mobile and online games using Bitcoin as well as Green Man Gaming, Humble Bundle and PlayStation Network.

Pay For TV: Dish Payments

Satellite TV provider Dish has been accepting bitcoin payment since 2014. The network provider allows people to pay for their favorite TV subscription packages using Bitcoin in addition to other payment options.

Bitcoin Payment is also available for DISH Customers who wish to make one-time payments on mydish.com. The company has partnered cryptocurrency exchange Coinbase to accord its customers a smooth payment process.

Charity and Tipping

If you are into charity or returning gratitude as a sign for good gesture, then you can use some for your Bitcoin holdings for tipping and charity. There are a number of sites online that accept Bitcoin payments for donations.

Wikimedia Foundation is one such charitable organization that accepts Bitcoin donations that go towards the development and distribution of free, multilingual education content.

Bitcoin for Charity List contains a growing list of verified charities that accept Bitcoins.

Places To Spend Bitcoin Offline

Currently, there are very few places where one can spend Bitcoins while offline. However, it is still possible to spend the cryptocurrency in brick and mortar stores as well as on some services.

Food Beverage Joints

There a number of food and beverage joints around the world, that have been accepting Bitcoin payments for some years.

PizzaForCoins located in California U.S allows people to buy Pizza using Bitcoins.  Pemburry Tavern Pub in London, on the other hand, allows revelers to pay for drinks using Bitcoin.

Burger Bear, a food joint located in London also accepts Bitcoin payments as well as The Pink Cow a dinner joint in Tokyo Japan.

Pay For Taxi Services

Depending on location, there are Taxi services around the world that accepts Bitcoin payments. One of the largest taxi companies in Italy Cooperativa RadioTxi 3570 accepts Bitcoin for fares. Taxis in Budapest Hungary have also started accepting Bitcoin payments as part of a service supported by CoinPay.

Merchants

Merchants around the world have started accepting Bitcoin payments in brick and mortar store with the integration of apps that allows them to receive such payments.  In Japan, for instance, there are about 260,000 commercial facilities made up of food establishment’s, drugstores and retail locations that accept BTC payments.

Some of the business installations in the island nation that accepts Bitcoin payments include Comicap and Anshin Oyado as well as electronics retail chain Bic Camera.

Paying For Tuition

Even though Bitcoin is yet to find its way into the mainstream industry, a University in Cyprus, The University of Nicosia became the first higher learning institutions to accept such payments for its Master of Science in Digital Currency’ Course.

Nebula-AI (NBAI): The convergence of AI and Blockchain

The blockchain space is full of projects without a clear use case and clear value, but, as we’ll see, there are also projects which are quite the opposite. Nebula-AI (NBAI) is creating a decentralized AI computing platform which will make AI DAPPS (which they call DAI Apps) a reality. The first product and demo that they released is Quant-AI: A cutting-edge trading price prediction tool. In this article, we’ll dive into the specifics of this project and take a look at Quant AI and the broader concept of DAI Apps.

Thanks to the use of GPUs and parallel computing for algorithms like machine learning (ML) AI has finally become widely viable. This created a huge industry which infiltrated into our daily lives. Every time you are talking to your virtual personal assistant (Alexa, Siri or Google assistant) or Facebook suggests you which friends to tag in your photos, AI is working behind the scenes.

AI is more than one of the many buzzwords we hear in the tech world. AI is often proposed as some sort of panacea for all sort of problems, which it is not. Still, its potential is so great that the estimated value for the AI market worldwide in 2018 is over $7 billion, in 2020 it is expected to grow to $17 B and in 2025 it is estimated to hit $90 B.

This technology is already overwhelmingly used in many industries. In medicine it is used to predict heart attacks or diagnose mental health problems from speech patterns (and AI actually seems to manage both those things better than human experts), in finance it is used for quantitative financial analysis and price prediction (an example of this is Quant AI itself) and the list could go on. AI is not only Alexa and Google Assistant, it is going to be a really important part of our modern lives way sooner than most expect.

Current issues of the AI industry

There are some big issues with how AI services work nowadays which Nebula-AI is trying to solve. Before explaining how those are being addressed let’s take a look at what are the problems that the AI space is currently struggling with.

Centralization and control

Since the infrastructure, which provides the service is completely centralized, it is also completely dependent upon the hosting company. Cloud providers such as Google or Amazon could decide to cease offering their services at any given moment. That means there is no guarantee that the service that you are using will exist in the future. This could jeopardize your business processes.

Data privacy

Since AI development is linked to cloud services the data is completely centralized. Giving too much of your data to one single company can lead to great problems when this data is exploited. This topic has been brought into mainstream discussion lately after Cambridge Analytica has used the data it obtained from Facebook to influence the outcome of the US elections. This incident gives great insight into how broad the consequences of Big Data misuse can be.

Lack of talent and a high barrier to entry

This technology is demonstrating its ever-growing potential and its development is actually rapid, but it could be exponential. Two major issues are slowing down the development of this space: the lack of AI talent and the high cost of AI development.

The lack of talent in this space means that the top talent is reportedly paid up to 1.9 million dollars. No startup can afford to pay that much. This means that only big, established and well-funded companies can afford to recruit good AI researchers which limits not only the speed of development but also the democratization of this technology. And that, given the great potential of AI is a serious issue in and of itself.

AI deployment is very expensive, in part because of the need for great amounts of computing power needed. The maintenance of large data centers is pretty costly. A high cost creates a high barrier to entry for startups, researchers, and developers that are trying to get started in this space.

How Nebula AI addresses the problems of the AI industry

Democratizing AI computing and storage

NBAI lets people pay for distributed computing power on shared machines with their tokens. This solves a number of issues. The most apparent among those is the efficiency since in this system no idle resources are being paid for. That’s in part obtained by sharing the resources with other users. But that’s not the only advantage of decentralization.

Decentralized encrypted data storage

With NBAI no central organization has access to all your data. That is obtained by the combined usage of IPFS, multiple private keys for access control and data verification which makes sure the data cannot be tampered with. This way you can be sure that your data won’t be misused or even accessed by who shouldn’t have access to it.

AI engineer training center in Montreal

NBAI has established an AI training center in Montreal where people with a background in mathematics or programming can learn fundamentals about artificial neural networks and how they’re being used for machine learning, as applied to speech and object recognition, image segmentation, modeling language etc.

A blockchain for AI computing

Most of us already do know that blockchain mining consumes lots of electricity and computing power. Actually, Bitcoin mining consumes more electricity than Ireland and it has been predicted that this blockchain mining will account for 0.5% of worldwide electricity use by the end of 2018. What many people don’t know is that this computing power is used only for the purpose of securing the blockchain.

That is a really huge amount of computing power that could be put to better use. That being said, the inefficiency of Proof-of-Work based blockchains is beyond the scope of this article. What I wish to point out is that such blockchains create a distributed computing network which is already really efficient at what it is doing. Sure, there are ways to operate a blockchain with way less computing power using other consensus algorithms. Still, the amount of computing power obtained by those networks is quite remarkable.

That’s the case because miners themselves profit more if their nodes are efficient. What NBAI envisions is that such miners could actually perform AI calculations instead simple hash calculations in order to obtain tokens.

Another big advantage of this approach is that many GPU mining machines can be converted to NBAI AI computing machines. This can potentially accelerate the network growth because many miners hold potential future nodes of the network. Still, since building decentralized networks takes time, NBAI has deals in place with large-scale third-party data centers in Quebec. This will ensure the system will be operational immediately when launched.

NBAI system architecture

Helix (Until 2018 Q3)

The first Ethereum independent blockchain (and phase) of the NBAI project is called Helix. Proof-of-Work (Ethash algorithm) will be used to secure this blockchain. Using an independent chain has many advantages. For the most part, with its own chain, the project will suffer from fewer traffic delays and some fundamental underlying proprieties of the blockchain can be tailored specifically for the very peculiar needs of such a system.

That means that the Gas (transaction) cost will be different in order to motivate miners to get profit through AI calculations instead of traditional Proof-of-Work mining. The way that it will work for nodes is that they can obtain tasks from the task pool by smart contracts. Then, after they performed the task, they submit the result and receive the token rewards. Another fundamental propriety which will be altered is the mining difficulty. This will be done in order to increase the speed of generating blocks and adjust the token production.

Still, PoW is really inefficient and has a limited scalability. Also, nobody ever solved Proof-of-Work’s 51% attack vulnerability. Those are probably the main reasons why this consensus algorithm is only used in the first phase of the project.

Orion (2019 Q1 onwards)

A fundamental property of distributed computing is that the closer the distance between nodes, the lower the cost of communication and the higher the computational efficiency. This propriety is the basis for the new consensus algorithm which is being developed by NBAI: Proof-of-Group (PoG). In PoG consensus systems and token incentives are used to ensure both efficiency and security.

In the PoG system, there are two different kinds of nodes: work nodes and ledgers. The role of a work node is to compute artificial intelligence tasks. The ledger, in addition to normal calculation, can also be responsible for allocating subtasks to all work nodes in the area (called a virtual working group). The task results are then written onto IPFS. After that is done the completed contract is verified by the ledger.

Self-organized efficient network architecture

In order to ensure an efficient communication between nodes of the virtual working groups an algorithm which creates a self-organized network topography which is efficient has been developed. Here is how it works.

When a new work node joins the system, it searches for nearby nodes. If it finds nodes with fast response time it joins them and becomes one of the worker nodes of the virtual working group. If the node doesn’t find any nodes with an acceptable response time it elects itself as a ledger. Nearby nodes will have a faster response time and will work together under a single ledger that coordinates them. Such a system ensures the highest possible network efficiency and generates an efficient network design.

No 51% attack vulnerability

The working groups compose a ledger network which uses the Byzantine consensus system for the joint ledger. This solution ensures complete safety against 51% attacks (which PoW doesn’t) and higher efficiency. Such attacks recently had some pretty bad effects on some cryptocurrencies. The most notable example is Bitcoin Gold (BCG).

Nebula AI use cases

There are a lot of potential applications for a more efficient and privacy-conscious AI computing service. Some possible applications are biomedical imaging, protein structure calculation (a generating task), computational marketing and various kinds of analysis of big data like social media feeds.

What’s more, this project offers more than just potential to speculate about. The team has developed some functional demos which run on their testnet that can actually show us some examples of what the system is capable of. Those are the aforementioned Quant AI and the Sentiment Analysis DAI Apps.

Demos offered by Nebula AI

Quant AI

One demo that the NBAI team has developed to demonstrate the potential of the system that they are creating is called Quant AI. Quant AI is a DAI App on the NBAI testnet which predicts the Ethereum trading price. This tool analyzes time series and trains deep learning models based on AI algorithm to forecast real-time trends and implement automatic trading of cryptocurrencies.

Advanced AI trading price prediction is something that has been accessible only to few people so far and now thanks to this initiative will become widely available and will be developed further. That’s the potential of blockchain democratization applied to AI.

Sentiment Analysis

The sentiment analysis DAI App is a natural language processing DAI App developed by NBAI. This tool helps users classify the polarity of a given text and extract the attitude of the writer. It is currently used as a price prediction model for trading, evaluation of consumer inclination, online conversations positioning and content inclinations.

Social media are gold mines of public opinion on any given topics. Such data can be monetized in various ways amongst which predicting market movements is the most obvious one. An example of how this tool can be used is given by this sentiment analysis of the subreddits of the main cryptocurrencies (the example given has actually been obtained using a less accurate algorithm which isn’t based on an artificial neural network).

Analysis

This is one of the projects that look promising from the get-go but only get better as you continue getting to know them more. AI is a huge industry which is currently booming and is still so new that has a lot of space for improvement and suffers from various issues. NBAI sure won’t solve all the problems that this space is facing right now but it is actually addressing some of them.

Speculative value

From a speculative point of view, their token is just as promising as their project in general. Computing power is constantly getting cheaper (both from a hardware cost and electricity consumption standpoint) so the amount of work that you will be able to get done with the same number of tokens is going to grow over time. At the same time, also the number of users willing to pay for such a service is probably going to grow drastically. That is also confirmed by the AI service market value estimates.

More AI applications are going to be developed over time and more AI applications become possible as the amount of processing power available increases. It is hard to imagine how the NBAI token could become worthless. Sure, there is always the possibility that the whole system fails for some reason but the presence of actually functional product demos on the testnet makes it appear way less likely for this project than for most other ICOs. The ICO concluded on 20th April with $5,874,054 gathered.

No investment is 100% safe

Still, this system is under development and a lot of things can go wrong (Cryptocurrency and ICOs are always really speculative and risky investments. The NBAI whitepaper actually explains it pretty well at the very beginning in the “Risk statement” section.

One thing worth pointing out is that the very presence of such a detailed risk statement is a big plus since it demonstrates responsibility on the team’s part. You should never trust a project that claims your investment will be 100% safe and guarantees returns. That being said, the risk statement still says the truth and you should only invest what you can afford to lose.

Another thing to keep in mind is that there are some other projects that bring AI to the blockchain. Sure, every one of them has its own strengths and weaknesses but there definitely is some overlap. So, to put it shortly there are two main things that can go wrong with this project:

  1. The system could fail or an unsurmountable issue could stop the development.
  2. Too much of the market could be lost to the competitors or could not be “taken” from the centralized counterparts.

Walgreens Drags Dow Lower Just Days After Replacing GE

The Dow is down sharply early Thursday with the headlines blaming lingering concerns over an escalating trade war between the United States and its major trading partners, China and the European Union for the triple-digit, 0.48% loss.

However, if you dig deeper into the cause of the sell-off and the size of the move, you may want to place the blame on the performance of Walgreens.

Just days after Walgreens (WBA) replaced General Electric Company (GE) in the Dow Jones Industrial Average after the close on Monday, it is the biggest drag on the stock market.

The catalyst behind the weakness in Walgreens, or for that matter the health-care sector today is the news that Amazon is acquiring online pharmacy PillPack in a deal that could shake up the prescription drug industry.

Although both Amazon and PillPack did not disclose the details of the pact, traders expect the move to be completed during the second half of the year.

According to Walgreens Boots Alliance CEO Stefano Pessina, “Yes, it’s a declaration of intent from Amazon.”

This is significant to the health-care industry because it may lead to lower prices for pharmaceutical prescriptions over the long-run. On the surface, the deal is a major sign that Amazon is serious about its intent to move further into the health-care industry.

Analysts are saying that the move threatens to remove one of the few distinguishing factors pharmacy chains have relied on to fend off Amazon, the sale of prescription drugs.

Shares of Walgreens, CVS Health and Rite Aid all tanked after the announcement along with drug distributors Cardinal Health, AmerisourceBergen and McKesson.

Not only is the prescription of the three major retails being threatened, but also their so-called “front of store” sales, which have already suffered from weaker sales due to the impact of Amazon’s main business.

The move by Amazon is important because it represents an aggressive attack on the status quo of the healthcare system in the U.S., which could eventually lead to lower prices for consumers across the board.



Earlier in the year, Amazon announced an alliance with Berkshire Hathaway and JPMorgan Chase to form their own healthcare insurance provider to help their companies get better control over employee and company healthcare costs. Today’s acquisition of PillPack may be part of the retail giant’s overall play to lower healthcare costs.

The weakness in the healthcare sector today is just another concern for investors who are already facing challenges this week from escalating trade war tensions.

Facebook, Inc. (NASDAQ:FB) In Trouble For Sharing Data With Chinese Company

The social media giant has data partnerships with four electronic manufacturers from China including Huawei which has been flagged as a security threat by U.S Intelligence officials. Huawei is believed to have a close relationship with the Chinese government which is why it is seen as a national security threat by U.S officials who have been worried about Huawei devices being used to spy on American secrets.

Facebook entered into the data sharing partnerships as early as 2010 and the other Chinese companies involved are TCL, Oppo and Lenovo. The partnerships are still ongoing despite the concerns expressed by security officials in the U.S but Facebook reported in a recent interview that it will terminate its deal with Huawei.

Facebook also provides data access to other companies including Samsung Electronics, Amazon.com, Inc. (NASDAQ:AMZN), BlackBerry Ltd (NYSE:BB), and Apple Inc. (NASDAQ:AAPL) among others. Most of the companies are smartphone manufacturers while others such as Amazon collect data to improve their digital and online services.

Such deals allowed Facebook to secure an early lead in the mobile market as early as 2007 even before mobile phone apps became popular. However, things really took off well when the onset of smartphones Facebook officials revealed that the deals with Chinese manufacturers granted provided it with access that is similar to what Blackberry had been offering. This means the company could collect detailed information on user devices and also on all their friends. The information collected includes relationship status, education history, work and interests.

The social media giant also told U.S intelligent officials that the data it provided to Huawei was stored on phones and not on its servers. According to Virginia’s Senator Mark Warner, this is not the first time that there has been concerns about Huawei. He stated that there was a previous report by the House Intelligence Committee in 2012 regarding the close relationship between electronic manufacturers such as Huawei and China’s Communist Party.

Huawei reportedly received millions of dollars in funding from China’s policy banks in order for it to expand its business across Africa, Europe, and South America. Huawei’s founder Ren Zhengfei also happens to be a former engineer for the People’s Liberation Army.

Warner stated that he was eager to know more about how Facebook made sure that user information was not sent to Chinese servers. Facebook vice president Francisco Varela defended the company stating that all of the integrations between Facebook and the four Chinese companies were controlled from the beginning and that the company made sure that it approved everything that was constructed.

The recent concerns about how Facebook has been handling data come just a few weeks after its CEO, Mark Zuckerberg was questioned by government officials about the firm’s involvement with Russians who are believed to have meddled with the U.S Presidential elections. However, the company managed to get out of that situation although Zuckerberg had to answer a lot of questions.

Is EOS the Most Promising Cryptocurrency in Development?

EOS is a project who has drawn much attention to itself lately. In part because of the recent sudden increase in the value of its native token and its Weiss rating.

In this article, we will analyze the potential of the EOS project and its probable future. It is my personal opinion that this cryptocurrency is a serious contender for the title of “Most promising DAPP/smart contracts platform”.

What is EOS?

EOS is a project belonging to the same category as Ethereum (platform for DAPP and smart contracts) but substantially different. In fact, EOS seems to have two main objectives that it seeks to achieve through its development: Scalability and ease of use.

Scalability

Scalability is the term used to refer to the number of transactions a blockchain is able to handle in a given period of time. A blockchain that can handle a large transaction load per second without any problems is called “scalable”. EOS faces this challenge mainly through two implementations: DPOS and interoperability between blockchains (achieved with the Dawn 3.0 upgrade).

DPOS

DPOS, Distributed Proof Of Stake, is the consensus algorithm of EOS (Steemit and BitShares use the same algorithm, after all, they had the same technical director, Dan Larimer). This algorithm sacrifices a certain amount of decentralization for a big advantage in terms of scalability. In fact, in the worst-case scenario, it is estimated that a single native EOS blockchain will reach 1000 transactions per second. But, in reality, it is to be expected that these will initially be around 3000 and then increase as the protocol is updated. For comparison, Ethereum handles about 20 per second, Bitcoin mind about 7.

The price of this is that only the 21 so-called block producers can validate the blocks, which substantially reduces decentralization. This is not the most resilient or incensurable blockchain, but it is the most suitable for mainstream use on a large scale. In fact, unlike what many believe, EOS will not “kill” Ethereum. Of course, as I previously suggested, it will probably get a good slice of its market. But Ethereum will continue to have its own niche. In particular, ETH will thrive where immutability, security, and decentralization are of utmost importance.

The blocks on the EOS network are also generated every half second. This means that transactions will always be confirmed within a few seconds if not just one. On the Ethereum network, an average transaction on press time takes about a minute and a half to be confirmed with one block added to the blockchain every 10-19 seconds based on network congestion. The Bitcoin blockchain instead takes on average just under an hour and a half to confirm a transaction with a block added every 10 minutes.

EOS seems a very good long-term investment
EOS seems a very good long-term investment

Inter Blockchain Communication

The other, even more noteworthy, way in which EOS seeks to increase its scalability is communication between blockchains. This allows, according to the reports, two or more blockchains to communicate (and collaborate to manage a greater load than single chain could). Particularly noteworthy is the statement that this standard is as secure as are interactions between smart contracts on a single chain.

This means that a transaction on one chain becomes automatically available on another. The only disadvantage is that this becomes visible only after this transaction has been confirmed on the other chain (that should happen in under 3 seconds). This feature of EOS is the basis of the statement that EOS can handle unlimited transactions per second.

Ease of use

Another not to be underestimated feature of EOS is how much attention has been dedicated to making it easy to use. The system includes features such as humanly comprehensible addresses, password recovery systems or the lack of transaction fees (which allows you to interact with DAPPs without owning tokens). These, together with its speed, make it possible to interact with the blockchain without even knowing that what you are using is not just a normal website.

To understand what is described, just look at steemit. This social/blogging platform, although it has some peculiar features, doesn’t seem to have a blockchain and some tokens at its base at all. This is the kind of DAPPs that are going to be hosted on EOS.


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Airdrops for EOS hodlers

Airdrop has become now a typical buzzword that we hear in the blockchain industry with the intention of attracting attention. This term simply refers to the free distribution of tokens. Often this is done in order to draw attention to the project, for example by giving tokens to those who have participated in other ICOs, so that they look for the project from which they derive. Other times just to trigger network effects. But in the EOS ecosystem, Airdrops have a different motivation, which is why I have said in the past that this may be the best investment in the long term.

“What’s the reason?” is the question that spontaneously arises in the mind of any person with common sense. This is because everyone knows that you should never expect anything for free. The answer to this question brings us to our attention something that is actually even better news.

Block.one has raised several billion dollars so far through the EOS ICO. These funds are intended to finance projects for which there will never be an ICO. In fact, more funds have already been announced for this purpose, including the USD 100 million joint venture between Block.one and the German Fintech incubator FinLab AG.

Projects financed by these funds, collected during the ICO, do not, therefore, need to finance themselves by selling their tokens. Their tokens are then distributed free of charge (hence as an airdrop) to all holders of EOS tokens. This means that investing in EOS is investing in a whole ecosystem in a much more direct way than investing in other similar projects (e.g. NEO or ETH). An analogy would be to buy ETH and consequently, in the coming months, receiving also the tokens of all the major projects realized on the platform for free.

Some Numbers

The EOS page on Coinmarketcap indicates that, with a total market capitalization of 10,590,855,420 dollars, this token is the fifth cryptocurrency by market cap. In fact, the latter has recently surpassed Litecoin (LTC) which has a market capital of 6,596,457,497 dollars (therefore now just over half that of EOS) at the time of printing. As far as price is concerned, EOS has grown by more than 1800% in less than a year (since July 2017) and then sustained a drop. (The graph renders the image previous to the drop in price.)

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The features described above, once tested by real software have attracted a large number of investors. In fact, initially, the product has been subject to countless criticisms due to its ICO, which lasted nearly a year and will end in just a couple of days. But those who believed in the project when most accused it of being a scam enjoyed a low-price entry and substantial gains.

Analysis

It should be considered that the value of the EOS token at this time is purely speculative. In fact, until the EOS network is launched in three days, the token is completely useless. Ten billion dollars is a very high estimate for a platform still in development. We can, therefore, draw two logical conclusions:

  1. The price of the token at this time is mostly linked to the enthusiasm due to the upcoming launch.
  2. Consequently, a price correction is underway.

It is a Bubble, But that’s Not an Issue

EOS seems a very good long-term investment. That said, like any investment in this space, it is subject to high risk. The reason for this is that the sector is immersed in a huge speculative bubble. It is not by chance that this is often compared with the dot-com bubble that burst at the beginning of the millennium.

Indeed, just like at the beginning of the millennium it is to be expected that the vast majority of companies in the sector will fail. But that bubble was also a primordial soup in which companies such as Google and Amazon developed, the stocks of which at the time were worth only a fraction of what they are valued nowadays. In the same way, this time too, we can expect that the revolutionary technology such as blockchain, just like the Internet did, will lead to the birth of companies of similar relevance. My opinion is that EOS may be one of them.

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4 Triggers for the Next Bitcoin Boom

As the founder and COO of BitcoinIRA.com, the first and largest Bitcoin IRA platform, I have witnessed this year’s significant Bitcoin price drop firsthand which has caused potential investors to approach the market with trepidation. Both current and prospective customers frequently ask me when the market will be rebound again. And while prices across digital currencies have dropped heavily in the first quarter of this year and nobody has a crystal ball to predict the future, I believe the start of our next big bull run is just around the bend.

Experts agree as well. For example, Thomas Lee, managing partner at the popular financial firm Fundstrat Global Advisors, anticipates a record peak for Bitcoin by July. Lee’s prediction is based on analysis from the currency’s 22 corrections since 2010, but here are some additional factors that could contribute to Bitcoin’s eventual spike.

SEC Approval & Regulation

Why is regulation needed?

When an industry scales and grows at lightning speed, increased regulation is inevitable. I believe that this is a good thing, as it is indicative of cryptocurrencies’ long-term staying power, and continued prevalence at the mainstream level. Regulating a once notoriously unregulated industry is undeniably nuanced territory, and for many in the space, it may require an attitude adjustment. We should stop looking at regulation as a hamper to the crypto space, and instead put that energy into working alongside the regulations to make this industry more compliant, transparent, and reliable than ever before.

I believe that SEC approval of crypto as a regulated security could drive walls of new institutional money, and is indicative of greater mainstream adoption of cryptocurrencies as a whole.

What’s the latest progress?

In early March, the U.S. Securities and Exchange Commission (SEC) issued a statement declaring that all cryptocurrency platforms that meet the definition of a “security” must register with the SEC as a national securities exchange. While this likely contributed to Bitcoin’s price decline in the short term, I believe this increased regulation ultimately serves the consumer’s best interests in the long term, as it provides a necessary level of oversight in safeguarding against scammy ICOs and hacks.

At least one regulatory body confirmed publicly that it does not want to prevent the growth of cryptocurrencies and the chairman of the U.S. Commodity Futures Trading Commission (CFTC) recently confirmed that by stating recently the need for balance and a “do no harm” approach when regulating cryptocurrencies.

Image: Chairman of CFTC, Christopher Giancarlo, stated a “do not harm” approach is needed when regulating cryptocurrencies
Image: Chairman of CFTC, Christopher Giancarlo, stated a “do not harm” approach is needed when regulating cryptocurrencies

I believe this new oversight will increase the trust in cryptocurrency transactions and will directly contribute to the next Bitcoin boom.

ETF approvals

What is an ETF?

ETF’s, or exchange-traded funds, are marketable securities that track an index, a commodity, bond, or a basket of assets like an index fund. An ETF is a type of fund that owns the underlying assets (shares of stock, bonds, oil futures, gold bars, foreign currency, etc.) and divides ownership of those assets into shares. The actual investment vehicle structure (such as a corporation or investment trust) will vary by country, and within one country there can be multiple structures that co-exist.


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Why could it drive up the price?

Traditionally, ETFs were created for products that are difficult for investors to hold (such as oil and gas). Similarly, setting up crypto wallets and executing trades can be considered difficult for average investors, so the potential of crypto-related ETFs may allow for simpler trading through brokerage accounts.

What’s the latest progress?

According to the SEC, “the agency has started the process to approve or disapprove a change in its rules that allows two Bitcoin ETFs to be listed on the NYSE Arca Exchange.” SEC approval for a Bitcoin ETF exchange will only further cement Bitcoin’s mainstream presence and likely also contribute to a massive price increase.

Lightning Network

What is the Lightning Network?

The Lightning Network is a decentralized network that uses smart contract functionality in order to enable instant payments across a network of participants. An “off-chain” solution that is built on top of the blockchain, the Lightning Network ahs transactions and scripts that are parsable and can be enforced on the blockchain if needed. The blockchain’s off-chain solution, however, allows transactions to be processed in a faster and with much lower fees than ever before.

Why could the Lightning Network drive up the price?

Elizabeth Stark, co-founder of Lightning Labs, says that the goal of the Lightning Network is to process “many thousands of transactions per second and maybe someday even millions of transactions per second,” surpassing the capabilities of traditional credit card companies like Visa.

With this kind of technical innovation in the works, Bitcoin prices have potential to soar. But it may take a little bit of time. As Stark said herself: “Bitcoin is a marathon, not a sprint. People wanted it to be a sprint.”

What’s the latest progress?

On March 15, Lightning Labs launched a beta version of its Lightning Network (LND) software specifically available for the developer community. Designed to tackle some of the legacy blockchain’s obstacles surrounding high fees and slow transaction times, LND uses smart contract functionality to enable payments and process transactions of the blockchain.

Retailer Acceptance (e.g. Amazon)

How many retailers currently accept Bitcoin today?

Bitcoin is currently accepted at several major retailers, including Overstock.com, Expedia, Microsoft, and about another 100 stores with more growing very quickly.

I believe that more retail acceptance will increase the number of transactions, wallets created and overall Bitcoin holdings as consumers purchase Bitcoin in order to pay for goods and services.

What’s the latest progress?

Coinbase is aggressively moving into the retail space with the launch of their new product: Coinbase Commerce. This enables retailers to accept bitcoin alongside traditional choices such as credit card or PayPal.

Image: Coinbase commerce
Image: Coinbase commerce

Also, Amazon has secured some cryptocurrency domains, and Starbucks CEO Howard Schultz has expressed his interest in using cryptocurrency for large-scale retail adoption. “I personally believe that there is going to be one or a few legitimate trusted digital currencies off of the blockchain technology. And that legitimacy and trust in terms of its consumer application will have to be legitimized by a brand and a brick and mortar environment, where the consumer has trust and confidence in the company that is providing the transaction.” Schultz said. With Starbucks’ mobile app already redefining the customer experience in its brick and mortar stores, adding cryptocurrency seems like a natural progression and one that has potential to contribute to the next Bitcoin boom.

 The writing is on the wall: with so much momentum surrounding Bitcoin and other digital currencies, in my opinion, it’s only a matter of time before prices rebound again.

This article was written By Chris Kline, Co-founder, and COO at BitcoinIRA.com

Bitcoin is Evolving Just Like Amazon

Volatility, however, is an indicator that a potentially powerful force is coming into its own. In this regard, one might think of Bitcoin as a new Amazon: navigating some growing pains but developing innovative solutions to help solve them.

At this point, it’s safe to say that Amazon has achieved retail dominance, and while Bitcoin’s story is in a much more formative phase, its monumental upward trajectory points to its increasingly dominant role in the global financial landscape.

bitcoin amazon 1

Amazon’s Early Struggles Mirror Bitcoins

Amazon, established in 1994, was originally born out of Jeff Bezos’ vision to establish “the world’s most consumer-centric company, where customers can come to buy everything they want online.” Given Amazon’s larger-than-life presence in the retail landscape today, it can be hard to remember the company in its infancy, when it was merely an online bookseller. Like most companies intent on scaling their vision, Amazon faced its fair share of growing pains and challenges in the early days, as many customers were initially wary of online shopping and additional shipping costs. While Amazon Prime, a subscription-based service offering free two-day shipping alleviated some of these concerns, it still took time for the company to gain steam and build credibility at the global level.

Meanwhile, Bitcoin, which was born in 2009 out of the financial crisis and established in order to “create a purely peer-to-peer version of electronic cash that [would] allow online payments to be sent directly from one party to another without going through a financial institution,” has also encountered its share of obstacles scaling its vision. Particularly, the legacy Bitcoin blockchain that powers Bitcoin transactions faces slow transaction processing times and high transaction fees.

But much like the developers at Amazon working tirelessly to develop new, innovative solutions, a passionate group of developers in the crypto community have been actively involved in refining old platforms and building new ones in order to present a growing number of solutions to meet a wide range of technical issues.

Amazon Pivoted to Succeed and Bitcoin Is Too

Amazon may have begun as an e-tailer marketplace, but the company quickly expanded its range of offerings by creating many of its own niche products and services, ranging from the Amazon Kindle to personal assistant Alexa. The company has also demonstrated its desire to tap into other sectors, whether by acquiring Whole Foods and reimagining the experience of shopping at a grocery chain or working with Berkshire Hathaway and JPMorgan to control costs and reduce spending on health insurance.

Similarly, the cryptocurrency community has also been hard at work implementing platform changes to meet a growing array of user needs. The Lightning Network, a decentralized network that uses an “off-blockchain” solution in order to enable instant payments across a network of participants, is expected to launch sometime in the new future, solving the legacy Bitcoin blockchain’s scalability problem.

Furthermore, just as Amazon staked its claim as a company with versatile offerings that far surpassed its e-commerce platform, the cryptocurrency community has been actively developing technical platforms with offerings that stretch far beyond alternative payment systems. Two particularly noteworthy examples? Ethereum and Ripple.

Ethereum And Ripple Are Evolving Like Amazon’s Alexa

While Amazon may be leading the charge in cutting-edge fields like artificial intelligence, Ethereum is paving the way for a new relationship with Amazon as well as smart contract technology and decentralized applications.

Ripple, too, which has two primary products for banks (xCurrent and xRapid), has demonstrated its wide range of capabilities that far exceed its function as native cryptocurrency XRP.

Indeed, the constant innovation and implementation in the cryptocurrency community ensures that, much like Amazon, the digital currency space is continuing to grow, improve, and reshape business and commerce as we know it.

The New Amazon: Bitcoin Moving Past Its Infancy

The fact that Bitcoin has moved from a mere concept in a white paper drafted during the 2008 financial crisis to one of many influential digital currencies over 10 years later is a testament to the fact that cryptocurrency is more than just a fad. Like Amazon, it will demonstrate that disruption of an industry is never without its speed bumps along the way.

This article was written By Chris Kline, Co-founder, and COO at BitcoinIRA.com

Alphabet Inc (Google) Is Pursuing the Pentagon’s Giant Cloud Contract Quietly, Fearing An Employee Revolt

Google leaders used the two meetings and described the way in which company’s transition cloud computing as well as how it has been positioning itself as a powerhouse for research and development of artificial intelligence. In particular, the company’s founder was keen on showcasing how they were about AI every day and how they intend to implement cloud. This is according to one former and one current senior official from the Defense Department.

According to the officials, who spoke on condition of anonymity, this was not an overt sales pitch as such. However, the effect of the trip was transformative for the company. During the trip, Mattis also met a number of representatives from Amazon.com, Inc. (NASDAQ:AMZN). Mattis went west with a lot of reservations concerning the department’s shift to cloud and by the time he returned to Washington, he was fully convinced that the military needed to import a big portion of its data to a commercial provider of the cloud. The move would go beyond just managing emails, files or paperwork.

In September last year, officials from the Defense Department announced that the department would be moving into a cloud on a large scale. The Joint Enterprise Defense Infrastructure, or JEDI, the program has since been combined into a single contract and is worth $10 billion over a decade and will be awarded by the end of this year.

The competition for the contract is still in its early stages and the department is expected to announce the request for proposals any time this week. However, according to officials from the department, the race is shaping up into a three-horse race between Google, Microsoft Corporation (NASDAQ:MSFT) and Amazon. Oracle Corporation (NYSE:ORCL) comes in a distant fourth among the companies eying the deal. Although Microsoft and Amazon have been active participants in many events that are related to the deal, including an industry event which happened on March 7, Google has kept its interests in the deal away from the media and out the public gallery. The company’s management is even working hard to ensure that the details of their interest in the deal are kept away from its own employees.

The company has not responded to any comments regarding their interest in the JEDI deal. Google’s spokesperson in charge of cloud business recently said that they had secured the FedRAMP certification, which clears the company to compete for government contracts. Officials from Pentagon expect those who will lose the contract to protest so public conversation is being limited in a bid to reduce perceptions of favoritism. According to reports from several officials, Mattis is not concerned so much about who wins the contract. He has appointed Deputy Defense Secretary Patrick Shanahan to manage the entire process.  According to the officials, Mattis prefers the JEDI cloud to be secure and resilient and must be able to deliver any needed information fighters in combat. He also prefers a cloud that will not take long to build.

“A Fresh Fear is Lurking on Global Financial Markets”

The message from Tom Elliott, deVere Group’s International Investment Strategist, comes as market volatility has increased in recent weeks.

Mr. Elliott comments: “A fresh fear is lurking on global financial markets – and it is not about trade wars.

“It is that global GDP growth may have peaked in the current growth spurt, that began in early 2016.”

He continues: “Add to this three other key factors to add to investors’ nervousness.

“One, the ongoing fear that a trade war will break out between the U.S. and other major economies. Although the trade dispute with China has eased a little in recent days, largely due to Xi Jinping, the Chinese President, making a conciliatory speech last week.

“Two, the apprehension that a new wave of regulation will impact on the business models of some of America’s largest quoted companies, such as Facebook, Google, and Amazon.

“And three, growing tensions between the U.S., the UK, and France with Russia, and others, following Friday night’s attack on Syrian installations.”

He goes on to explain: “However, fundamentals remain supportive for stocks. Consensus estimates for global corporate earnings growth in the first quarter are at 15 percent over the previous year, while for the S&P 500 index it is 17 percent.

“The beleaguered U.S. tech sector is expected to see 22 percent earnings growth, which will help soothe investors’ nerves.

“Despite the prospect of two, maybe three, more rate hikes from the Federal Reserve this year, and probably one from the Bank of England in May, monetary policy remains loose by historical standards in all the main economies.

“This supports risk assets, buy keeping borrowing costs low for companies and their customers, and by keeping ‘risk-free’ rates low and unattractive relative to the expected returns from stocks.”

Mr. Elliott concludes: “Despite new geopolitical concerns, our investment positioning remains unaltered.

“We favor a long-term, multi-asset approach to investing, whereby investors choose a suitable combination of global equities and bonds – depending on their risk profile and investment horizon – and leave the portfolio unchanged. Too frequent rebalancing ensures winners are sold and losers are bought – which financial history, and common sense, supports.”