10 things before the opening bell
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Inflation is to blame, said Richard Curtin, the Michigan survey's chief economist. Consumer sentiment is plummeting because of a "growing belief among consumers that no effective policies have yet been developed to reduce the damage of inflation."
US consumers are feeling worse than they did at the start of the pandemic when 22 million people had lost their jobs.
Here's what else is at play:
- Consumer purchasing power is waning: Gas prices continue to surge, along with nearly every category tracked by the Labor Department.
- This year's soaring stock market may be about to lose steam: Morgan Stanley said the bull run for stocks likely won't continue next year.
- And there's politics, of course: President Biden is struggling to handle rising inflation and Republicans seem ecstatic.
2. Bitcoin is taking a beating after China threatens "punitive steps" to deter crypto mining. Meanwhile, the mood is muted for US stocks as investors wrap their heads around the Biden-Xi talks. Here are the latest moves on the market.
3. Bank of America shared its stock picks set to benefit from the infrastructure bill. Though sentiment has weakened for clean energy and industrial stocks, the firm thinks investors are overlooking this key sector. See BofA's full list of 42 stocks set to benefit most.
4. Earnings on deck: Walmart, Home Depot, and Aramark, all reporting.
5. Tesla stock dropped following Elon Musk's latest Twitter antics. Shares of the EV giant fell as much as 5% Monday after Musk clapped back at Senator Bernie Sanders and threatened to sell more stock. In the days after his Twitter poll, Musk sold off about $7 billion in Tesla stock — and just added more to that amount.
6. Rivian extended its post-IPO rally as the infrastructure bill moves forward. Biden's new bill is designed to accelerate consumer adoption of EVs, allocating $7.5 billion to build out charging stations nationwide. Momentum behind the EV space and enthusiasm for its brand have handed Rivian stock big gains in the week since its IPO.
7. "The Big Short" investor Michael Burry sold virtually all his US stocks last quarter. Burry has been warning of a devastating market crash for months. But he did add to his positions in these three names.
8. A group of crypto investors has raised $3 million as part of an effort to buy a rare copy of the US Constitution. ConstitutionDAO is a decentralized autonomous organization that has raised 736 ether for the document's auction at Sotheby's. The copy is one of two still in private hands. Here's how much the document could sell for.
9. Meet the 26-year-old who acquired $1 million in real estate after starting with an $18,000 loan. James Walker III used a loan to buy his first FHA property for $350,000, which is what he recommends to beginner investors. He explained his portfolio strategy — including how he capitalizes on tax deductions and rental income.
10. Jefferies is expecting these underpriced stocks to rally once the Fed hikes interest rates in 2022. More efficient, smaller companies are underperforming now according to strategist Steven DeSanctis, but they should be set to rebound soon. See the 17 stocks he's expecting to outperform.
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