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Bitcoin fell 5% over the weekend and fell below $33,000 on
Monday, as the world’s most valuable cryptocurrency remained connected to tech
equities and the Nasdaq.
The recent trend contradicts bitcoin’s claim to be an inflation hedge. To be fair, gold, which has long been viewed as an inflation hedge, has also been harmed by Wall Street’s recent turmoil.
Bitcoin has fallen 50% from its all-time high of almost $68,000 in November, caught up in this year’s risk asset rout caused by increasing inflation, tighter Fed policy, and Russia’s Ukraine war. Over the years, Bitcoin has experienced numerous boom and bust cycles.
On Thursday, Bitcoin fell below $27,000 for the first time in almost 16 months, as the cryptocurrency market continued its losses, fueled in part by concerns about growing inflation. Bitcoin, which proponents promote as a gold-like store of value, has recently traded in tandem with tech companies and the Nasdaq. From its all-time high in November, the world’s largest cryptocurrency has dropped 60%.
Oil prices in the United States fell Monday, pulled down by a strong dollar and demand concerns as Covid lockdowns in China, the world’s largest oil importer, continued. Last week’s roughly 5% gain in crude prices, their second straight weekly climb, appeared to be driven by supply fears about Europe’s proposed ban on Russian oil. As a result, Monday’s about 2.5 percent dip only brings the American benchmark, West Texas intermediate crude, down to around $107 per barrel.
Peloton reported a larger-than-expected quarterly loss and a sharp drop in revenue on Tuesday, as inventory stacked up in warehouses and drained the company’s cash. In pre-market trade, shares of the linked fitness equipment producer fell more than 20%. Peloton forecasted a drop in revenue for the current quarter, citing lower demand. Some consumers may terminate their monthly memberships as a result of proposed subscription price hikes, according to the firm.
Pfizer announced Tuesday that it will pay $11.6 billion in cash for migraine medication manufacturer Biohaven Pharmaceutical. Pfizer will pay $148.50 per share in cash for any outstanding shares of Biohaven that it does not already own. That’s 78.6 percent higher than Biohaven’s Monday closing price, a premium that’s reflected in the pre-market on Tuesday. Pfizer paid up to $1.24 billion for the overseas marketing rights to two migraine medications from Biohaven in November, with Pfizer taking a 2.6 percent stock holding.
Novavax stock dropped more than 20% in pre-market trade after the vaccine company under performed both top and bottom line expectations for the most recent quarter. The shortfall comes as Novavax sold only 31 million Covid dosages in the first quarter, significantly short of its target of 2 billion shots for 2022. While confirming its previous revenue prediction for 2022, the business predicted that vaccination sales will pick up in the current quarter.
According to Reuters, Tesla has halted most of its
manufacturing at its Shanghai plant owing to a lack of parts, citing an
internal document. It’s the latest setback for the electric vehicle
manufacturer’s factory in China’s largest city, which has been
under lockdown for more than a month as a result of the country’s
On Monday, EU Industry Commissioner Thierry Breton met with Tesla CEO Elon Musk in Texas, and the two indicated that they had reached an agreement on Europe’s digital media laws ahead of Musk’s purchase of Twitter. Musk claimed the spirit of the Digital Services Act “absolutely aligned” with his ideas in a video with Breton. The two did not go into depth on the rule, which punishes platforms for failing to control unlawful content with steep fines.
The 10-year Treasury yield popped back above 3%
on Wednesday after the government’s April consumer price index rose a
stronger-than-expected 8.3% year over year. Removing volatile food and
energy prices, so-called core CPI still rose a great-than-expected
Inflation has been the single biggest threat to a recovery that began early in the pandemic and saw the economy in 2021 stage its biggest single-year growth level since 1984.
The big swings in financial markets recently reflect growing worries that the Federal Reserve continues to act too slowly to arrest the spike in inflation.