Global stocks trade nervously ahead of mega-tech earnings, while Brent crude hovers near $90

A trader works on the trading floor at the New York Stock Exchange in Manhattan, New York City, US, on December 28, 2021.

Andrew Kelly/Reuters

• Global stocks kicked off a crucial week for the battered tech sector by trading mixed on Monday.
• Investors are anticipating results from mega-cap tech titans Facebook, Google, and Amazon.
• Oil prices continued trading at seven-year highs ahead of an OPEC+ meeting on Wednesday.
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Global stocks traded mixed Monday in a big week of earnings for the tech sector, while geopolitical tensions around Russia and Ukraine were helping drive oil prices higher.

Futures on the Dow Jones and the S&P 500 swung between gains and losses, while those on the Nasdaq rose 0.5% as of 5:20 a.m ET, pointing to a mixed start to trading later in the day.

Following last week's Federal Reserve-inspired volatility of large intraday swings in the market, sentiment for the tech sector is slowly shifting to positive after bullish results from Microsoft and Apple.

"While the Fed, macro, and geopolitical (Russia/Ukraine) issues have created a 'perfect storm sell-off' over the last month with tech stocks seeing red screens on a daily basis, the most important tech earnings season in a decade is now the focus of the Street and so far investors like what they see," Wedbush analysts said in a Monday note.

More than 100 companies in the S&P 500 are due to report earnings this week. Within the battered tech sector, Google parent Alphabet is due to release earnings Tuesday, followed by Facebook on Wednesday and Amazon on Thursday.

The market is pricing in a more hawkish Fed, with at least five rate hikes expected this year. While initial expectations were for a quarter-percent rise, Atlanta Fed President Raphael Bostic suggested in a Financial Times interview Friday that the Fed could hike by a half-point in March if needed.

Not much is on the Fed's diary for this week, but data releases on the economic calendar includes the final global Purchasing Managers Index and JOLTS job openings on Tuesday, and the January US jobs report on Friday. 

Economists expect the headline nonfarm-payrolls figure to show a subdued rise of just 150,000, given that it will be impacted by the Omicron coronavirus variant.  

Also in focus are the European Central Bank and the Bank of England's latest monetary policy decisions on Thursday, with many economists predicting UK policymakers will increase interest rates again.

In Europe, stocks traded higher on the prospect of positive corporate earnings.

London's FTSE 100 was broadly flat. The pan-European Euro Stoxx 600 added 0.8%, while Frankfurt's DAX moved up 1.08%.

Lunar New Year holidays in Asia meant thin trading in the region, and stock markets closed mixed. Data on Sunday showed China's factory activity contracted by the sharpest rate in nearly two years in January. 

The Shanghai Composite dropped 0.97%. Hong Kong's Hang Seng and Tokyo's Nikkei each closed 1.07% higher.

Oil prices hovered near seven-year highs as tensions over Ukraine are still attracting the market's attention, ahead of the OPEC+ meeting on Wednesday to discuss a March production increase.

"Given the higher prices and failure to live up to prior output agreements, OPEC won't find it hard to lift output by another 400,000 barrels — this is priced, so I don't expect a lift in output to rock the crude price too intently," said Chris Weston, Pepperstone's head of research.

Brent crude futures at last check were up 0.6% at $89.07 a barrel, pulling back somewhat after breaking through the $90 level to hit $91.31 earlier Monday. Meanwhile, West Texas Intermediate put on 0.7% to reach $87.44 a barrel. Prices were around $55 this time last year.

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North Korea releases pictures from space that it says were taken from its latest missile test

Images that North Korea says were taken from its recent Hwasong-12 missile test.

KCNA

• North Korea shared photos showing Earth from space, saying they were taken during its missile test.
• It was the first time North Korea launched a nuclear-capable missile that big since 2017, Reuters reported.
• The US and other nations are worried as North Korea ramps up its missile testing.

North Korea released photos of Earth taken from space, and said they were taken during its recent powerful missile test.

North Korea said on Monday that it had tested a Hwasong-12 intermediate range ballistic missile over the weekend. It said that missile was capable of reaching the US territory of Guam, the Associated Press reported.

According to Reuters, it was the first time the country had launched a nuclear-capable missile that large since 2017.

North Korea said the images from space were taken by a camera that was on the warhead of the missile.

The photos show the Korean peninsula.

This appears to be North Korea's seventh missile test this month alone.

State media reported that the launch was to check the accuracy of its weapons system.

A senior US official told reporters the US was worried North Korea could be ramping up toward testing nuclear weapons and intercontinental ballistic missiles, Reuters reported.

Other nations, including neighboring South Korea and Japan, have also condemned the tests, the BBC reported.

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Russian money and Brexit is undermining the UK-US relationship. Here's how a future prime minister could improve it.

Boris Johnson and Joe Biden at the G7 summit in Cornwall last year.

Getty

• Tensions over Northern Ireland may be delaying the end of Trump-era sanctions, a former ambassador said.
• There is also "frustration" in Washington about the UK's perceived failure to crack down on money laundering in London.
• There is "some resentment on both sides" over the chaotic withdrawal from Afghanistan.

President Joe Biden and UK Prime Minister Boris Johnson are presenting a united front as they hold crisis talks with other world leaders over how to prevent Russia from invading Ukraine.

But the so-called "special relationship" hasn't always run quite so smoothly since Biden took office.

President Biden was elected months after referring to Boris Johnson as "a physical and emotional clone of Donald Trump." He has repeatedly rebuked the prime minister, both in private and public, over ongoing Brexit disputes in Northern Ireland which are yet to be resolved, making pointed references to his own Irish ancestry.

For his part, Johnson raised eyebrows in Washington when Downing Street said he preferred not to use the term "special relationship," reportedly suggesting it made Britain sound "needy and weak." 

So what is the current state of UK-US relations, and — given an ongoing row over illicit parties which could yet see Johnson replaced as prime minister — what priorities might help a future prime minister to improve them?

At a personal level, relations between the Johnson and Biden camps are "pretty good" at the moment, said Peter Westmacott, the UK ambassador to the US under President Obama. Defence, intelligence-sharing, and much of foreign policy co-operation remain strong, as evidenced by co-ordinated actions on Ukraine.

But there remain significant tensions, most particularly over the Brexit situation in Northern Ireland, which "may be delaying the lifting of Trump-era sanctions," Westmacott said.

Biden has repeatedly warned that Johnson's actions could undermine the Northern Ireland agreement, the defence of which he considers a key part of his political identity given his Irish ancestry.

After the surprise resignation of Lord Frost, the Brexit minister, in December Foreign Secretary Liz Truss was tasked with overhauling the Northern Ireland protocol. Truss, a potential leadership rival to Johnson, has already received warm praise from Brussels following a second round of bilateral talks this week, although the impasse remains.

Westmacott also pointed to "some resentment on both sides" over the chaotic withdrawal of UK and US troops from Afghanistan last year and other issues including the case of Anne Sacoolas, the wife of a US diplomat who faces criminal charges in the UK after being charged with causing the death of a teenager by dangerous driving.

 The UK has also surprised some in Washington with a more muscular foreign policy than many expected it to adopt after Brexit, said Charles Kupchan, a senior fellow at the Council on Foreign Relations who was senior director for European affairs at the National Security Council under President Obama.

"The more internationalist dimensions of the British government have prevailed against the inward-looking impulse," said Kupchan. "And I think that's good news for the UK-US relationship."

That approach has been on display in Ukraine, where the UK has adopted a harder line against Putin than many of its European neighbours as the Russian president masses thousands of troops on Ukraine's border.

The crisis appears to have sharpened minds and brought NATO powers including the UK and US closer together, but there is also frustration in Washington over the UK government's failure to tackle "dirty money" flowing into London from Russia.

American officials are reportedly concerned that economic sanctions in Russia in the event of war with Ukraine would be ineffective because they can launder money so easily through the UK.

London has gained an unwanted reputation as a money-laundering hub for prominent Russian business figures with links to the Kremlin.

"There is a level of frustration" from Washington towards the UK about the issue, Max Bergmann, the former State Department official, told Insider. "The lack of action from the UK is troubling."

Bergmann this week proposed a UK-US "anti-kleptocracy" task force should Russia invade Ukraine, a measure designed to crack down on laundered Russian money as frustration in Washington about the UK's inaction grows.

"Crises are clarifying," he said.

"If Russia does invade Ukraine, there's going to be a strong push from the US and I think inaction from the UK would be very damaging for the relationship."

However, the consensus view was that the long-term relationship between the two countries would remain strong, whatever the current leaders' personal views of each other.

Westmacott said: "President Biden showed early on that he was not going to bear grudges against Johnson. But he thinks Johnson's support for Brexit was unwise, and damaging to US as well as UK interests."

"He distrusts him over Northern Ireland, and like other leaders sometimes has difficulty in knowing when to take him at this word."

"Joe Biden is a pragmatist and he is a people person," Kupchan said. "And he believes in the importance of building relationships. I don't see any differences over Brexit or any divergences of opinion in the past as affecting the relationship."

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A robot bartender that serves up cocktails in 90 seconds will be on duty at the Winter Olympics as organizers seek to keep a lid on COVID-19

The robotic arm can serve cocktails in around 90 seconds.

Fabrizio Bensch/REUTERS

• A robotic bartender will serve cocktails at the 2022 Beijing Winter Olympics' media center.
• The bot can shake and serve drinks in around 90 seconds, according to the South China Morning Post.
• Organizers are aiming to minimize the number of COVID-19 cases within the games' "closed loop."

For journalists looking to wind down after a long day's coverage at this year's winter Olympics, a different kind of snowball could await them at the games' media center.

Organizers of the Beijing 2022 Winter Games have equipped the media center with a robot bartender, which can mix and serve cocktails in around 90 seconds, according to the South China Morning Post. Guests can order their drink by scanning a code on their phone, the Post added.

The installation comes amid organizers' efforts to minimize the risk of spreading COVID-19 at the games. In addition to the robotic bartender, a restaurant catering to athletes and those working at the games will also be operated by machines, according to the Post.

The bot works behind a circular bar in the media center.

Fabrizio Bensch/REUTERS

The robot barkeep — which serves both alcoholic and non-alcoholic cocktails — sits behind a circular bar and below dozens of bottles suspended from the ceiling, according to a video from Reuters. In the video, the robot is shown filling a cocktail shaker from one of the overhead bottles, adding ice, then mixing the contents before straining the green liquid into a margarita-style cocktail glass. 

The bar will also be staffed by a number of human bartenders to supervise the bot's work and lend a hand.

Meanwhile, the restaurant, which is open only to people working at the Olympics, will serve food such as burgers and rice, that are prepared and served by machines, per the Post. Using tracks running along the ceiling, orders are lifted straight from the automated kitchen and lowered direct to tables.

Dishes in the restaurant will be prepared by robots in an automated kitchen.

Liu Lu/VCG via Getty Images

China has operated a strict "zero Covid" policy since the start of the pandemic, aiming to keep cases at bay through frequent local lockdowns, border closures and quarantine rules for international arrivals. It has adopted a similar approach to the games.

Athletes, media personnel and Olympics staff will operate within a "closed-loop" system, meaning they will be isolated from the general domestic population. International visitors have been barred from attending the games as spectators.

Athletes and staff are obliged to present a negative test before boarding any flights bound for the games, again upon arrival at the airport, and a third time before entering the closed loop, according to the International Olympic Committee.

Speaking at a remote technical briefing earlier in the week, Dr. Brian McCloskey, chair of Beijing 2022's medical expert panel said the "three layers of testing" aimed to filter out any potential positive cases at every stage, and minimize the number of infections that get into the closed loop.

The 2022 Beijing Winter Olympics will operate a "closed-loop" policy.

Zoya Rusinova\TASS via Getty Images

"The target is zero spread within the closed loop, and the closed loop is there because that's what protects the people of China by keeping the domestic population separate from the participants coming in from around the world," Dr. McCloskey said. 

Athletes and staff will also be subject to regular PCR tests for the duration of the games, which will take place between February 4 and 20. 

According to the International Olympic Committee, pre-Games testing has demonstrated that the system in place is "operating successfully." As of January 23, out of 2,586 tests conducted at Beijing airport since January 4, only 39 have reported a positive result. Within the closed loop, 33 positive results out of 336,421 tests have been reported. 

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Crypto's correlation with stocks is going to tighten, but volatility is going to pick up as the Fed ends its easy-money policy, Real Vision's Raoul Pal says

Raoul Pal, CEO of Real Vision.

Real Vision Television

• Real Vision CEO Raoul Pal said crypto's correlation with stocks shifts, but is likely to tighten as the Fed hikes rates.
• He said crypto's correlation to stocks is decoupled when growth is fine and central bank policy is loose.
• "Everything is a risk curve, every single part of the investable universe, and crypto is part of that risk curve," he said.
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Cryptocurrencies haven't been able to catch a break so far in 2022, despite the booming interest in the metaverse and the "gold rush" in the non-fungible token market, as the stock market has buckled in the face of higher interest rates.

Real Vision chief executive Raoul Pal believes stocks and crypto are set to move in even closer lock-step, particularly as the Federal Reserve brings two years of cheap cash and ultra-loose monetary policy to an end. But this will likely mean even more volatility. 

"Everything is a risk curve, every single part of the investable universe, and crypto is part of that risk curve. Sometimes it's correlated, sometimes it's not. When you go to a macro shift, everything gets a correlation of 1, and we've seen that. So it periodically correlates and periodically decouples depending where we're on the risk curve," Pal told the ARK Invest Big Ideas Summit earlier this week.

US blue-chip stocks have been on a near-unbroken downtrend so far in January, with the S&P 500 down around 9%, while the tech-heavy Nasdaq 100 has fared far worse, with a decline of 13%. Bitcoin and other cryptocurrencies have followed suit. 

Bitcoin has lost about a fifth of its value so far in January, to trade around $35,000 - a far cry from November's record near $69,000, while 2021's erstwhile superstars like solana and avalanche have lost around 40%.

Crypto's proponents have often cited its role as a portfolio diversifier. But, as interest rates rise and investors have more assets that will offer a decent yield, this relationship will break down, Pal said.

"It tends to be really decoupled in that mid-cycle phase where growth is okay, central bank policy is loose, crypto does its own thing," he said.

It's the shift in the cycle that will alter the correlation, and market volatility is nothing more than a reflection of a shift in the narrative, he said.

"The narrative was the inflation shift. Inflation destroyed marginal spending and marginal investing. And I think we've seen it in meme stocks, we've seen it across the market, we've seen it in cryptocurrencies," he said.

With consumer inflation running at its hottest since 1982 and growth booming along at a four-decade high in the fourth quarter, the Fed has had to shift gears and go from trying to pump up the economy to trying to stop it overheating. 

After the Fed's most recent policy meeting on Wednesday, markets are preparing for at least five rate hikes this year. But Pal is less hawkish.

"Central banks will be more dovish than people expect going forwards, so we should have a longer cycle with more tailwinds," he said.

Despite the growth in the later stages of 2021, the economy does not have traction and it may be a few years before the full impact of the coronavirus-driven recession is obvious. Typically, after a recession, growth bounces back quickly, but can then plateau, which can unnerve investors, but rarely means another full recession. 

"That's very typical of every recession I've ever followed," he said.

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Having a side hustle can lead to burnout — but setting boundaries and finding the right balance will help you thrive, say experts

Ashleigh Dickinson juggles between her full-time designer job and her side hustle.

Ashleigh Dickinson

• Junior designer Ashleigh Dickinson suffered from anxiety when her side hustle became prominent. 

• She told Insider about the strain that juggling two roles put on her mental health.

• To be successful, you must be willing to unlearn what you know, a side-business coach told Insider.

Side hustling has become more popular as the Covid-19 pandemic hit, leaving people with plenty of time on their hands and realizing their nine-to-five jobs may not cut it.

One in three Americans reported having a side project on top of their full-time job in 2021, according to Zapier, an automation service that moves information between web apps. Among millennials, 50% reported having a side hustle, while 45% of all working Americans reported having one. 

Junior designer Ashleigh Dickinson spoke to Insider about her side hustle and the challenges she faced when juggling a demanding full-time job with her brand, AFTA Youth.

Dickinson said: "We live in such a fast generation and everything is shared, so having a side hustle is your personal thing, it's something you've achieved."

She continued: "We live in a diluted world — everyone influences you on everything so it is kind of nice to have your own thing that you have created. She added that, ultimately, it is down to a generational attitude of "let's break the rules," and be your own boss that keeps her going. 

In February, Dickinson felt burned out and was not enjoying what started off as an exciting project. "I learned that I had to be really strict with myself because it started to take a toll on my mental health," she said. "From the pressure of doing my job, the pressure of having all these orders to do and the growing demand, my anxiety, which I hadn't had for five years, came back."

She wondered whether it was too much pressure to deal with both a full-time job and her side project.

Side-business and life coach Emily Tyson discovered through her experience of working a full-time job and having had three businesses of her own, finding the right balance is imperative in preventing burnout. 

Initially, starting a side hustle is another way for people to find "fulfilment," Tyson said, "whether that's with a creative outlet, a new challenge, to top up their salary or to work towards building a future for themselves."

Balance is key to attaining what made you start your side hustle and you must find what works for you, Tyson said. She recommends that side hustlers "experiment and allow yourself to take a step back," especially if you feel burned out. 

Regardless of the project you want to start, Tyson explained that you must be willing to "unlearn everything you know." The instant results and pivots you may be able to achieve in your main job will not be similar to your side business' success. 

Ashleigh Dickinson dropped six collections including fluffy hats.

Ashleigh Dickinson

According to Bill Gates, ways to prevent burnout include avoiding routine, finding new projects, and setting yourself challenges, Insider's Carlos Galán Feced and Nathan Rennolds reported.

Other side hustlers that Insider spoke to highlighted the importance of setting boundaries to avoid dealing with recurrent burnout and remain motivated. 

Insider spoke to Burning Tree's CEO Peter Piraino. Burning Tree's mission is to treat those affected by mental health disorders, as well as chronic relapse.

He said: "The US right now really suffers from a culture of 'more and now', particularly 'now' and people feel like they have to produce tangible things to show their value."

Social media drives people to seek approval from others in a way that people will gauge their self-worth, depending on their "social recognition," said Piraino, who is also a master social worker and chemical dependency counselor.

Having a side hustle will require sacrifice, as well as time outside of your full-time job, social life, and personal time. Spreading yourself thin may cause disruptions in your relationships and impact your mental health in more than one way, Piraino added.

 

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Orcas observed devouring the tongue of a blue whale just before it dies in first-ever documented hunt of the largest animal on the planet

Approaching a blue whale to attach a suction - cup tag

Elliott Hazen under NOAA/NMFS permit 16111

• A study from Australia is the first to scientifically document the killings of blue whales by orcas. 
• Orcas were observed devouring the nutrient-rich tongues of the giant blue whales.
• "This is the biggest predation event on this planet," said a marine scientist.

For the first time, a pack of orcas — also known as killer whales — have been observed hunting and killing blue whales, the largest animal on the planet.

According to a report published in Marine Mammal Science, the scientific community has long debated if orcas can hunt the massive blue whales. 

But this question has now been answered after three instances of packs of orcas attacking blue whales off the coast of Western Australia were recorded by marine scientists from Cetrec WA (Cetacean Research). It includes details of how the killer whales swam inside the mouth of the enormous whales to eat their nutritionally rich tongue just before they died.

"Here we provide the first documentation of killer whales killing and eating blue whales: two individuals killed, 16 days apart in 2019, and a third in 2021," researchers wrote in the paper. "Notably, the first whale taken appeared to be a healthy adult."

Researchers arrived at the first killing of a 72 foot-long blue whale to see large chunks of skin and blubber having been gouged its body and with most of the dorsal fin having been bitten off. 

It was followed by relentless attacks by the orcas, where three lined up against the blue whale and pushed it underwater, while two attacked its head. 

 

The study explains that 50 orcas joined the pack for six hours to feed on the carcass.

A few weeks later, the next attack occurred when a blue whale calf was targeted. Twenty-five orcas attacked the 40-foot long animal. 

The final attack recorded by the study was on a 45-foot long blue whale, chased for 15 miles in a 90 minutes hunt. Again, the orcas hunting strategy was to push and ram the whale under the water while others attacked its head and tongue. A 50-strong pack devoured the remains of the kill.

 

Orca whale and calf

Jeff Foott/Getty Images

Mother orcas are the lead aggressors

Previous studies thought that orca attacks had to be executed by the biggest killer whales — who are male and can grow to 30 feet in length— to be successful. However, the breakthrough study documented these killings were led by female orcas, with the study saying that the drive to feed their offspring may make them more aggressive. 

"This is the biggest predation event on this planet: the biggest apex predator taking down the biggest prey," study co-author Robert Pitman, a marine ecologist at Oregon State University's Marine Mammal Institute, told National Geographic. "We don't have dinosaurs anymore, so for me as a whale biologist and a zoologist. It's an amazing thing."

 

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Cracks are finally showing in retail traders' 'diamond hands', after 2 years of relentless tech-stock dip buying

Data suggests retail investors are pivoting away from flashy tech stocks.

VIEW press/Getty Images

• Retail investors seem to be tiring of buying the dip in flashy tech stocks, as the market sell-off knocks confidence.
• Instead, they've been chasing rallies in value sectors like energy and financials, an analyst said.
• Robinhood's weak Q4 earnings added to worries that retail traders may not have the market's back in 2022.

The army of retail investors that mushroomed during the pandemic has been relentlessly "buying the dip" in technology stocks for almost two years.

Online, they cheer each other for their "diamond hands" – that is, their ability to hold onto assets and stay committed to the market, no matter what.

But over the last couple of weeks, as stocks have tumbled, cracks have been showing in those diamond hands.

Data suggest the dramatic fall in shares of flashy tech companies has dented amateur investors' confidence. That means they're more reluctant to follow the pandemic playbook of snapping up stocks such as chipmaker Nvidia.

The tech-heavy Nasdaq 100 index has fallen more than 10% this year, as investors braced for the Federal Reserve to turn off the stimulus taps in a bid to tackle red-hot inflation.

"There have been some signs of retail capitulation," Ben Onatibia, senior strategist at data company VandaTrack, said in a note this week.

Individual traders sold Nvidia and fellow chipmaker AMD on net last Thursday and Friday, Vanda data showed, in a departure from their behavior during previous tumbles.

"Retail investors have been equally reluctant to buy the dip in other risky pockets of the equity market," Onatibia wrote.

"SPACs, ARKK constituents and meme stocks have seen very little demand from retail investors," he said, referring to special purpose acquisition companies and Ark Invest's tech-focused Innovation ETF.

Read more: UBS' investment chief identifies 4 critical tech industries to start carefully buying the dip in after the correction

Yet retail investors are still buying, even if they're less gung-ho than before. It's just that their focus seems to have shifted somewhat.

Vanda's data showed amateur traders poured $1.8 billion into equities in Tuesday's session.

Ben Laidler, global markets strategist at eToro, said the trading platform's users have been investing relatively heavily in energy and real estate stocks, as they grow worried about inflation.

He told Insider he's seen a small, but not dramatic, shift away from tech.

That chimes with Vanda's data. Onatibia said "retail investors have been chasing rallies in value sectors like financials and energy."

Yet Wall Street is having its doubts as to whether the retail crowd can be relied on to support the market in 2022, as they have done throughout the coronavirus pandemic so far.

Monthly active users on Robinhood's highly popular trading app fell to 17.3 million in the fourth quarter, from 18.9 million in the previous three months, according to the company's earnings report Thursday. 

"Bottom line, we believe the younger, smaller investor that HOOD so efficiently acquired in 2021 is moderating his/her activity," Piper Sandler analyst Richard Repetto said in a post-earnings note.

The Fed's plans to hike interest rates and the resultant stock-market volatility are testing everyone, retail traders included, Laidler said.

Many analysts say amateur investors will continue to be a force in the market for the foreseeable future. But they might not have the same impact they had a year ago, when they sent GameStop skyrocketing and kicked off the meme stock craze.

"The so-called rise of retail is actually much more structural than people give it credit for," eToro's Laidler said.

"It's platforms like us, it's free trading, it's fractional ownership … it's online communities, it's low interest rates — which, regardless of what the Fed does any time soon, will still be low."

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