Bitcoin nears $50,000 amid fresh reports of mainstreaming and continued dollar weakness. Apple and Nissan fail to reach terms on an EV cooperation; oil surges as an Arctic blast causes blackouts in Texas, and stocks are drifting higher after the Senate’s acquittal of Donald Trump underlines Joe Biden’s hurry to get his stimulus bill done. Here’s what you need to know in financial markets on Monday, February 15th.
Bitcoin Tests $50k as Dollar Slides Again
Bitcoin prices neared $50,000 over the weekend after two new developments affirming the narrative that the cryptocurrency is ‘going mainstream’.
Canada approved its first Exchange-Traded Fund for Bitcoin, further expanding its accessibility to retail investors, while Bloomberg reported that Counterpoint Global, a unit of Morgan Stanley Investment Management, is also considering a first investment in the asset class.
The news comes less than a week after Tesla said it had transferred $1.5 billion of treasury reserves into Bitcoin as a risk diversification measure. That’s all part of a trend of bets on a cheapening dollar due to loose U.S. monetary and fiscal policy. The dollar index tested a three-week low on Monday in Europe, while the yield on the 10-year Treasury note rose to 1.21%, its highest in over a year.
Australia’s Squeeze on Facebook and Google
A landmark law that would force social media giants to pay publishers for the news they carry came a step closer to reality over the weekend.
Australian Treasurer Josh Frydenberg told ABC that the country was “very close to some very significant commercial deals,” after holding talks with Facebook CEO Mark Zuckerberg and Google’s Sundar Pichai over the weekend.
The law is being eagerly watched by media establishments and governments around the world. Google had threatened to shut down its search engine in Australia if it was passed. It’s unclear whether the weekend talks had led to any significant watering down.
Stocks Drift Higher After Trump Acquittal
U.S. stock futures drifted higher overnight on Monday, with cash markets set to stay closed until Tuesday due to the Presidents Day holiday.
The acquittal of former President Donald Trump on Saturday was taken as reflecting a desire by President Joe Biden to prioritize pushing through his spending plans rather than seeking political revenge on his former opponent. As such, it hints at the $1.9 trillion package getting through Congress faster and without dilution.
Overseas, Chinese markets remained closed for the New Year holiday, while Japan’s reopened sharply higher after a stronger-than-expected fourth-quarter GDP report.
Italian stocks were the outperformer in Europe after new Prime Minister Mario Draghi selected a number of party politicians, not just technocrats, for his new government of national unity. Analysts said that should help him keep discipline among the often quarrelsome parties that have agreed to back him.
Nissan Rejects Apple’s Terms
Nissan became the latest carmaker to be linked to Apple’s ambitions in the mobility sector.
The Financial Times reported that Apple had approached the Japanese giant some months ago with a view to partnering on its secretive project for autonomous electric vehicles. However, it reported that talks had broken down over, among other things, branding (Apple reportedly wanted its name on the product). It said that Nissan was reluctant to be seen as the “Foxconn of the auto industry”.
Nissan shares fell 2.8% on the news, while shares in automotive supplier Magna, which has also been linked with Apple, rose 3.5%.
Oil Surges as Storms Force Texas Blackouts
A blast of Arctic weather across the U.S. sent oil prices to their highest in 13 months. In addition to driving a spike in demand for heating oil, the weather front has led to Texas power grid operator ERCOT having to impose rolling blackouts in a state that accounts for much of the country’s oil and gas output. The incident is likely to spark fresh controversy over the rapid buildout of renewable energy sources, output from which has not been able to keep pace with demand.
By 7 AM ET (1200 GMT), U.S. crude futures were up 2.1% at $60.72 a barrel, while Brent crude futures were up 1.5% at $63.37 a barrel.