Overview of TOP weekly news 21.4.2021

21 / 04 / 2021
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Goldman Sachs recommends investing in Europe

The most known American investment bank, Goldman Sachs, published the recommendation to buy the euro against the dollar and the European index European Stoxx 600. The expected price in the next 12 months is increased from 1.21 to 1.25 euros per dollar. The European Stoxx 600 index is expected to strengthen by 10 percent in the coming months, which is a higher outlook than the expected growth of the main index of the New York Stock Exchange S&P 500, whose growth forecast is 4% lower than the Euro Stoxx 600. *

Investors always follow the outlook of Goldman Sachs analysts closely and often follow their forecasts. Among other things, Goldman Sachs published an investment recommendation a few weeks ago on a commodity copper that has been experiencing strong bullish growth in recent months.

How to be protected from inflation?

There are more and more growing voices among investors about fears of high inflation. However, there is a problem of stagnant growth in long-term bond yields, due to the purchase of bonds by central banks and the consequent impact on equities.

Goldman Sachs expects cyclical stocks to lag behind inflation expectations at present. If investors were guided by a historically proven inflation-bond market indicator, it could be assumed that the rotation from defensive to cyclical stocks has room for growth. *

History shows that if the correlation between equities and bonds diverges, we can predict the onset of inflation expectations, which will eventually return bonds to the stock-oriented direction. *

Britain will issue its own digital currency

The British authorities have issued a statement on the intention to issue their own digital currency called britcoin. The Treasury and the British Central Bank are currently in the process of evaluating the benefits of the digital currency. According to the AP, the fact that cash payments are generally in decline is part of the innovation, partly due to the pandemic.

Digital currency should coexist with current cash and bank deposits. One of the main benefits of britcoin should be the ability to strengthen card payments if cash payments decline in the coming years. The trend shows that by the end of this decade, only one in ten payments in Britain will be made with traditional paper money.

Johnson & Johnson benefits from the vaccine

According to the latest estimates, the Covid-19 vaccine produced by Johnson & Johnson will increase the company’s sales by $100 million. Johnson & Johnson’s revenues from the pharmaceutical industry increased 10% year over year. *

Performance of Johnson & Johnson’s shares (Source of the graph: Tradingview) [1]  

Amazing revenue growth of IBM

IBM announced the growing use of a hybrid cloud model with higher margins and AI, which contributed to the highest quarterly revenue growth in more than two years. Cloud combines and unifies public cloud and private cloud services from multiple cloud vendors, creating a flexible IT infrastructure that is less expensive than single cloud and single vendor access.

Performance of IBM’s shares (Source of the graph: Tradingview) [2]

Watch this week:

Thursday, April 22, 2021

The European Central Bank will report the outlook for economic growth, as well as decide on the deposit rate, which is expected to remain unchanged from the current level of -0.5%.*

Friday, April 23, 2021

The United Kingdom will announce the development of retail sales in March. Analysts expect 1.5% growth on a month-on-month basis. *

Germany will publish a manufacturing PMI in April. Expects a slight decline to 65.8 points. *

Source of the text: Investing, Zerohedge, Financial Times, Reuters, Tradingview


[1,2] Past performance is no guarantee of future results

* Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or based on the current economic environment which is subject to change. Such statements are not guaranteeing future performance. They involve risks and other uncertainties which are difficult to predict. Results could differ materially from those expressed or implied in any forward-looking statements.

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