Bitcoin’s Volatile Holiday Season

Today is Wednesday, December 29, 2021.

Bitcoin’s Volatile Holiday Season

The price of Bitcoin plummeted as much as 8% on Tuesday, finishing the day with a loss of about 3%, which was part of a larger sell-off involving cryptocurrencies.

Data: Over 165,000 traders liquidated their accounts over the preceding 24 hours, which was equal to about $500 million, according to data from Coinglass cited by Bloomberg.

Catalyst: The reason behind the holiday season downturn wasn't clear. Some speculated that institutional investors were to blame. Others say that the Federal Reserve’s plans to raise interest rates have resulted in Bitcoin losing steam as a hedge for investors in 2022.

Bigger Picture: Even though most cryptos had a miserable Tuesday, the stock market overall was positive.

Final Thoughts: In hindsight, Tuesday’s dip was not that dramatic. Bitcoin has seen worse days before, and the fact that the price of Bitcoin recovered a bit on Tuesday is a good sign.

Notables

Notable Earnings Today: FuelCell (Nasdaq: FCEL).

Notable IPOs Today: Green Brick Partners, Inc. (NYSE: GRBK), Nubia Brand International Corp. Unit (Nasdaq: NUBIU), ROC Energy Acquisition Corp. Common Stock (Nasdaq: ROC), The Short De-SPAC ETF (Nasdaq: SOGU), Strategy Shares Nasdaq 5HANDL Index ETF (Nasdaq: FIVR), Fat Tail Risk ETF (Nasdaq: FATT), The De-SPAC ETF (Nasdaq: DSPC), The SPAC and New Issue ETF (Nasdaq: SPCX).

Notable Equity Crowdfunding Campaigns Ending Today: The Hudson House & Distillery (MainVest).

Notable Economic Events Today: Goods Trade Balance (8:30 a.m. ET), Retail Inventories Ex Auto (8:30 a.m. ET), Pending home sales index (10:00 a.m. ET), Crude Oil Inventories (10:30 a.m. ET).

Inflation, Higher Costs Eat Into Cal-Maine’s Profit

Shares of Cal-Maine (Nasdaq: CALM) dropped 7.05% in after-hours trading on Tuesday after the fresh egg producer posted disappointing earnings.

Financials: Cal-Maine reported that net sales reached $390 million, which was better than expected. But the company’s earnings per share of $0.02 was lower than most expectations.

The Good: Demand was strong in the quarter and net sales increased 12.5% year-over-year.

The Bad: Net income only reached $1.2 million, which was way behind the $12.2 million that the company achieved in the same quarter last year. Cal-Maine cited inflationary headwinds and higher feed costs as two challenges.

Final Thoughts: Despite some economic headwinds, shares of Cal-Maine are still positive for the year. Can the company overcome these economic issues in 2022?

SPACs Take Wall Street by Storm

Since the end of 2020, the use of special-purpose acquisition companies (SPACs) has skyrocketed.

Definition: SPACs are basically blank-check companies that go public and then acquire a private business within two years.

Background: There were over 500 SPAC IPOs in 2021 – a record. Some private companies favor SPACs because it allows them to go public without the traditional hassles of an IPO. A few celebrities also started their own SPACs in the past year.

Recap: While some SPACs did very well in 2021, they started to lose some momentum as the year went on because of bad financials.

Final Thoughts: Despite decreased enthusiasm for SPACs, they will continue to remain a force in the investing world in 2022.

Trends to Watch

Outbreak: ‘Petri dishes of COVID’: CDC faces call to pause cruises as nearly 90 ships report coronavirus cases (MarketWatch)

Sold: Elon Musk sells another $1 billion in Tesla shares, nearing 10% target (CNBC)

There’s No Place Like Home: Home prices jumped 19.1% in October (CNN)

British Invasion: British companies look to muscle in on US retail investing boom (Financial Times)

Still Trading: China’s cryptocurrency investors keep the faith even as exchanges Binance and Huobi sever ties with mainland users (South China Morning Post)

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