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8.5% profit on Barclays PLC in our uptrend view

Barclays PLC EXITBarclays PLC 20201216 14.10

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Coronavirus Pandemic Speeds Shift to Cleaner Energy

The world’s transition to cleaner sources of energy is gaining speed as the coronavirus pandemic accelerates a shift in investment away from fossil fuels, according to the International Energy Agency.

Capital spending on energy this year is set to plunge by 18%, as global energy demand is expected to fall by 5% in 2020, a pullback not seen since World War II, the Paris-based agency said in its annual report on the future of the industry. But the projected investment cuts are highly uneven, highlighting a divergence in what companies, markets and investors are willing to finance. Spending on new oil and gas supplies took the largest hits, while renewable energy held up better than any other source, the IEA found. The pandemic weakened corporate balance sheets and increased uncertainty over future fuels demand, spurring the record cuts.

Solar- and wind-energy projects are benefiting from falling costs, as well as widespread government support, and monetary policies that support low interest rates. The IEA expects renewables to provide 80% of the growth in global electricity demand through 2030. 

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The IEA, an advisory body for the 37 wealthy nations of the Organization for Economic Cooperation and Development, which include the U.S., Germany and Japan, said its members’ annual demand for oil had probably already peaked, and their thirst for petroleum wouldn’t return to pre-pandemic levels. But oil demand is expected to continue growing in developing economies such as China and India, leading overall global oil demand to recover to pre-pandemic levels in 2023. The IEA forecast that oil and natural gas were still expected to make up nearly half of the global energy mix in 2040, even under a scenario that projects sustained government support for low-carbon investments.

While the pandemic has caused fossil-fuel investment to drop in the short run, and a projected 7% decline in energy-related greenhouse gas emissions in 2020 according to the IEA, those impacts may be short-lived. China, the first country to experience the pandemic and reboot its economy, has already seen emissions levels return to pre-pandemic levels, the IEA report said.

13.8% profit on Nikola Corporation in our downtrend view

Nikola CorporationEXIT

Nikola Corp on Tuesday disclosed details on its hydrogen fuel-cell-powered product lineup that will include vehicles with a driving range of up to 900 miles. 

Nikola Corporation 20210205 16.33

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5.8% profit on Nvidia in our uptrend view

NVIDIA CorpEXIT

Graphcore has objected to Nvidia’s $40 billion acquisition of Arm Holdings, according to a key member of the British chipmaker’s early developments.

NVIDIA Corp All Sessions 20210129 17.44

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6.5% profit on Lloyds Banking Group in our uptrend view

Lloyds Banking Group EXIT

Goldman Sachs upgrades shares of Lloyds Banking group to "neutral" from "sell"; bumps to 38p from 33p. 

Lloyds Banking Group PLC 20201118 09.09

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During Covid-19 Pandemic, Biotech IPOs Already Surpass Record

So far this year, U.S.-listed biotech companies have raised roughly $9.4 billion in initial public offerings, already beating the $6.5 billion raised in all of 2018, the biggest year on record, according to Dealogic data going back to 1995. This year’s biotech issues have jumped an average of 34% on their first day of trading, the biggest average first-day pop for the sector since the tech boom in 2000.

The recent surge in biotech stocks extends beyond IPOs, as investors chase companies working on potential vaccines to combat Covid-19. They also anticipate the industry may benefit from more investment by governments in drug discovery and development. Still, there are reasons to be skeptical. Biotech stocks in general can tend to be volatile, depending on the success or failure of companies’ key drugs. Some longtime biotech investors are wary of the run-up and warn there are risks to chasing companies at early stages of development.

The Nasdaq Biotechnology Index is up 13% so far this year, compared with the S&P 500’s 3.7% rise. In June, as the coronavirus pandemic swirled, the exchange-traded fund issuer ETFMG launched a product that focuses specifically on companies engaged in the testing and treatments of infectious diseases. The fund, the Treatments, Testing and Advancements ETF, trades under the ticker GERM. Public companies are already taking advantage of the flood of money into the biotech sector by issuing more stock at a record pace. So far this year, biotech companies have raised more than $32 billion in follow-on offerings, already the most ever in a year, according to Dealogic. 

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Many investors who have spent years analyzing and buying shares of biotech companies say the market’s enthusiasm for health-care companies might be overdone, particularly for companies that appear to be rising on bets that testing for Covid-19 vaccines will be successful. One company touting a vaccine candidate is Moderna Inc., MRNA -2.96% which has seen its market valuation balloon to nearly $30 billion, up from roughly $7 billion at the start of the year. Moderna, which codesigned the vaccine candidate with the National Institute of Allergy and Infectious Diseases, is embarking on a Phase 3 trial. Investors will soon have another coronavirus-related stock to bet on. A German biotech company, CureVac BV, is expected to list shares on the Nasdaq Stock Market in an IPO later this month, according to people familiar with the matter. 

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Companies Are Selling Stock at Record Pace to Start the Year

Public companies have been taking advantage of a hot stock market by issuing shares at record pace in January. U.S.-listed companies have conducted 57 follow-on stock offerings this year through Wednesday, raising $12.35 billion. Both numbers are records for this point in the year, according to Dealogic data going back to 1995. Many of the offerings have been from small pharmaceutical and other health-care firms. Also in the mix: pandemic-era videoconferencing star Zoom Video Communications Inc., ZM -0.63% which raised $2 billion in the largest such offering this year as it looks to build out its operations. The offerings coincide with voracious investor demand for stock: The S&P 500 has risen 2.6% this year, setting repeated highs after rallying 16% last year. At the same time, many biotech and pharmaceutical companies are eager to raise money for new drug candidates or vaccine research and trials.

Investors crowded into initial public offerings at a record rate in 2020. Companies raised $167.2 billion through 454 offerings on U.S. exchanges through Dec. 24, surpassing the previous full-year record for money raised that was set during the dot-com boom in 1999. The IPO market was boosted by a surge in special-purpose acquisition companies, which use money from an initial public offering to merge with another company. U.S.-listed SPACs raised $82 billion in 2020, a more-than-sixfold increase from the year earlier.  

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The fundraising boom extends beyond stock issuance. Corporate borrowing took off in 2020, fueled by the Federal Reserve’s response to the coronavirus pandemic, with U.S. companies breaking records for debt issuance. The strong start to the year for follow-on stock offerings builds on a record-setting 2020. U.S.-listed companies conducted 862 such offerings last year, raising $257.23 billion, the most in a year by either measure in records dating to 1995, according to Dealogic.

3.5% profit on Vodafone PLC in our uptrend view

Vodafone 3.5exit

Vodafone Extends Licensing Agreement with TiVo to Transform TV Viewing for Customers.

Vodafone Group PLC 20210127 17.15

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4.9% profit on Pfizer in our downtrend view

Pfizer Inc PFEexit

The Pfizer -BioNTech COVID-19 vaccine may be less able to protect against infection with a South African variant of the virus that has a worrying mutation, according to results of a British study.

Pfizer Inc All Sessions 20210106 17.08 

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