A threat to the stock market?
There is little to no doubt that the omicron version of covid19 will increase investors uncertainty. We can see that countries introduce new infection control measures to try to stagnate omicron, but the funny thing is that the markets do not encounter corrections. It is like this was not a surprise at all - it was like it was already priced into the market. I find it strange, in a scary sense. Just look at the big swinging S&P 500 in New York! Still steadily rising and that even after South African researchers discovered the new variant – omicron.
Source: Infront
At the same time, I can see that there is a rise in volatility lately, the fall on single days have been bigger, some sectors are heavily affected by the virus and the infection control. This winter is not going to be a golden age that’s for sure. I did put out a lot of sell orders out there today and I will finish of with the rest of what I see affected by covid19 tomorrow (29.12.2021). Look at health companies and the travel industry now, there will harsh times now when we enter 2022, that’s for sure… Nobody can use the latter companies’ services – it will affect the exchanges whether you want it or not. Me personally are moving more over to crypto since I feel like the stock markets are pumped with borrowed money and thin air. Here at Hive we can see tokens doing their halving, which makes it interesting for me to APE IN! Legendary times, don't you agree @belemo? 🤑 Transferred around 700 hives today, will probably transfer around 1000 hive every month, it’s time to put on the investment glasses and be serious about the whole thing! Now that we see that @ragnarok.game is also upon us I will start building HIVE as much as I can. I bet I am not alone, this is after all; a competition.
However, back to omicron and the market. Omicron needs to be priced into the market, right? It is like we knew it, “corona will be back”. When Spring is coming the usual pressure of infection in the northern hemisphere usually falls and at the same time as earnings start to get good for companies in general (historic measures). In the long term, it appears that inflation and the central banks response to it should concern investors the most. And by looking at the explosion in energy (electricity) prices lately it seems that this will not be over any time soon. Which will give you and me costs and thus not invest as much as we want into stocks and cryptos. As of the US as well we need to go back 39 years to find the equivalent of a price gallop, that is pretty insane and still the exchanges are hoovering around all time highs, something is lurking in the shadows.
The worst case is that it is possible that higher interest rates and reduced money printing have all been going on for too long. But what can they do? If they just keep on printing money we are... vel that is another story. And the FED… which now stagnate inflation and are rising the interests… that NEEDS to stagnate the price increase, right? Nevertheless, the stimuli of the banks have contributed greatly to the stock markets still hovering around all-time highs. And thus, the next stock market year will be marked by whether the central banks succeed in reducing inflationary pressures, without the stock markets falling sharply at the same time. It will become a super exciting year; it is like a super exciting movie that you can’t get enough of! No @Trumpman, I am not talking about the “Man of Tai Chi” – LOL!
So far, the answer is quite open. Maybe we avoid corrections and plunges, but I do not know, one thing is sure tough, we will have some tangible effects on which sectors who will win, and which sectors will lose. However, that will also concern crypto and its many tokens. In short term, there is still a lot of unresolved matters regards to the omicron virus. Like how dangerous and contagious it is. And, for how long will we have these restrictions that do not allow us to grab a beer at a bar or go to the cinema and the like. The outcome in January can define the stock market weeks to come. It is also an advantage to be careful in these times, so I am going to sell more of funds and stocks in the coming days just to decrease the risk of my portfolio. I would not hold on to stocks that has direct consequences due to the restriction that omicron bring with it. Shipping and transport sector will also be reduced from my side. There is maybe one company that looks stable now and I believe can be reasonably safe even in the event of stock market turmoil. That is Kongsberg Group, where also my dear friend @fredrikaa is working. Heard that the company did have a solid increase in price after he started there, we are talking three figures increase! Maybe my Fredrik had something to do with it (?). Otovo also seems promising as it is a stock that offers alternatives in a pressured electricity market.
In the end, it's about the choices we make ourselves in2022. It is difficult times when it comes to figure out where to invest your holdings. But adapting to a turbulent market is wiser than in a long time. Me personally, I am going to build even more crypto, especially here at HIVE, since we have many projects ongoing and many more projects yet to come. I can tell, I am excited, you should be to!
Cheers -Olebulls
