The surplus of dollar liquidity | 31 December 2021

#SP500:

The Conference Board reported this week that consumer confidence rose in December, while November’s number was revised upward as consumers end 2021 on a more optimistic note. The proportion of consumers planning to purchase homes, automobiles, major appliances, and vacations over the next six months all increased. Moreover, consumer concerns about inflation declined after reaching a 13-year high last month, along with concerns about COVID-19. This report points to positive signs for the economy next year as consumer demand is a vital driver of the economy. The surplus of dollar liquidity in the American banking system will have a positive impact on the capitalization of the stock market. The excess liquidity indicator on Friday once again renewed its all-time high and exceeded the $1.57 trillion mark. With such a significant surplus of capital, bankers will buy out stock market corrections and “move” the SP500 index to a new historical maximum.

Trading recommendation: Buy 4696 and take profit 4776.

#Vale:

Benchmark iron ore futures in China gained for a fifth straight week, fueled by restocking demand at steel mills ahead of new year holidays. Considering that the valuation of iron ore is lower than other ferrous metals, and the profitability at mills are relatively good, iron ore is expected to run stronger than steel products. Capacity utilisation rates of blast furnaces at 247 steel plants across the China increased to 74.33% this week from 74.28% the week before, according to Mysteel consultancy. The rise in iron ore prices will have a positive impact on the value of Vale's shares, as the company is one of the three largest exporters of metallurgical raw materials in the world.

Trading recommendation: Buy 13.65 and take profit 14.02.

#Nike:

NIKE Direct sales were $4.7 billion, up 9 percent on a reported basis and up 8 percent on a currency-neutral basis. Gross margin increased 280 basis points to 45.9 percent. Despite continued inventory constraints and supply chain challenges, NIKE Direct grew 8 percent, led by North America Direct growth of 30 percent, including record Black Friday week results. NIKE Brand Digital delivered strong revenue growth of 11 percent, led by double-digit growth in North America and APLA, partially offset by a decline in Greater China. NIKE continues to have a strong track record of investing to fuel growth and consistently increasing returns to shareholders, including 20 consecutive years of increasing dividend payouts. In the last quarter, NIKE returned approximately $1.4 billion to shareholders, including:

Trading recommendation: buy 163.95 and take profit 168.29.