Here is the market movement that Cathie Wood says “ridiculous” as her flagship fund spits out

Cathie Wood, star fund manager and CEO of ARK Invest, in a new video told investors that she shares their pain, as ARK Innovation Fund ARKK’s flagship fund,
-4.08%
has fallen 45% since February. She said ARK funds made up more than half of her individual retirement account and a “significant” portion of her net worth. “I want you to know that of course we’ve been through a very difficult time since the significant rotation from growth to value started almost a year ago in mid-February, and I want you to know that we are in there with you, ”she said.

It must be said that the managers of the companies in which it has invested do not necessarily feel the same thing. Company insiders in the innovation fund holdings sold $ 13.5 billion worth of shares in the six months to December while buying just $ 11 million, the Financial Time reported, citing data from brokerage firm StoneX.

While Wood still believes COVID-19 is accelerating innovation, she hasn’t been a buyer of the auto stocks rally since the new year, on news such as Ford doubling the production rate of the electric version of the F-150. “I look at the performance of stocks as [General Motors]
DG,
-2.58%
and Ford F,
-2.93%,
they’ve skyrocketed on those electric vehicle announcements, ”she said. “It’s ridiculous.”

Ford shares have jumped 18% this year as Chrysler owner Stellantis STLA
-0.73%
gained 9% and GM climbed 6%.

Electric vehicles represent around 2% of their sales. “What if the 98% or so were about to disappear as consumer preference shifted towards electricity? She asked. She also noted depressed consumer sentiment, rising used car inventories and the easing of the microchip shortage, as signs that the fall in sales of new vehicles that has yet to materialize. restored is not just a supply issue.

“And if we were right and there wasn’t a 20% increase in sales, maybe sales are stable year over year and that would put them at around 15 million. units, ”she said. “And they probably need to start cutting prices if we’re right about the used car market and the prices there, which means they’re probably going to be facing credit problems.”

During the 2008 recession, people chose to pay off their car loans instead of their mortgages because they had to get to work. This time around, they might not make the same choice due to the existence of carpooling, Wood said. “I wouldn’t be surprised if at least one of the companies lost money next year, which would be most unexpected.”

“Where are the crazy evaluations?” Are they in our stock, now that Zoom ZM,
-2.22%
fell to 33 or 35 times this year’s earnings? Or is it in a fleet where there could be losses, ”she asked.

Table

Jason Furman, former chairman of the White House Council of Economic Advisers and now a professor at the John F. Kennedy School of Government at Harvard University, put together this chart showing just how wrong economists and the market have gotten inflation in 2021. Furman told a American Economic Association Panel that normal multipliers showed that fiscal and monetary stimulus far exceeded the potential of the economy. He expects inflation to remain “very high” as demand will be above trend, and the shift from Federal Reserve policy will mean any tightening will only impact year-round. next anyway. He also said supply will continue to be below trend.

The buzzing

Tennis star Novak Djokovic won a court ruling allowing him to stay in Australia, although he could still be deported.

Senior US and Russian officials have launched formal talks in Geneva aimed at resolving tensions, with Russian troops stationed at the border with Ukraine.

The $ 1.8 trillion spending package that West Virginia Democrat Senator Joe Manchin proposed to the White House is no longer on the table, according to the Washington Post.

Take-Two Interactive TTWO,
-13.95%
entered into a $ 12.7 billion deal to buy Zynga ZNGA,
+ 45.20%,
in a deal that he says will strengthen his presence in mobile games.

Novartis NVS,
-0.40%
said he plans to seek Food and Drug Administration approval for a COVID-19 treatment he has cleared from Molecular Partners MOLN,
+ 19.93%,
after a phase 2 trial showed a 78% reduction in hospitalizations.

Clothing manufacturer Lululemon Athletica LULU,
-5.46%
warned that profits and revenue would be at the bottom of its target, citing the impact of the omicron coronavirus variant on capacity and staff.

Goldman Sachs economists increased their forecast for Fed hikes to 4 to 3.

The steps

US ES00 equity futures contracts,
-1.48%

NQ00,
-2.10%
indicated additional pressure before opening. Growth stocks have underperformed value stocks the most, according to FactSet, last week since election week 2020 due to Fed tightening fears.

The 10-year Treasury yield TMUBMUSD10Y,
1.809%
was 1.77%.

Top tickers

Here are the most active stock tickers on MarketWatch, as of 6 a.m. EST.

Teleprinter Security name

TSLA,
-2.47%

You’re here

GME,
-12.50%

GameStop

AMC,
-5.26%

AMC Entertainment

NIO,
-3.86%

NIO

AAPL,
-2.02%

Apple

OCGN,
-1.85%

Ocugen

NVDA,
-5.37%

Nvidia

BABA,
-0.37%

Ali Baba

TLRY,
+ 18.15%

Tilray

NVAX,
+ 0.25%

Novavax

Random readings

A Prehistoric “sea dragon” has been called one of the greatest discoveries in the history of British paleontology.

from China the artificial sun has become five times hotter than the real one.

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