Zooming back to reality 👨💻 😳

November 24, 2021 Zooming back to reality 👨💻 😳 Good morning traders, Welcome back to The Daily Setup. The Dow and S&P 500 saw gains yesterday, but the Nasdaq fell as tech stocks slid. Here’s what’s on the docket today: - Pasithea Therapeutics gains over 150% - Zoom’s stock crashes - Joe Biden tries to help with gas prices We’re off for the rest of the week so we can enjoy family time, football, and feasts, but we’ll be back in your inbox Monday morning. Happy Thanksgiving and see ya next week. Jeff Pasithea Therapeutics, Big Tech, and Zoom BIGGEST MOVER How About Some Uplifting News? Shares of Pasithea Therapeutics (KTTA) more than doubled during Tuesday’s trading session following the approval of their esketamine nasal spray Spravato. The stock, which closed Monday’s trading session at $2.21, spiked as high as $8.50 before closing the [session up a whopping 158.06% at $5.60.]( - [Pasithea Therapeutics is]( “a biotechnology company focused on the research and discovery of new and effective treatments for psychiatric and neurological disorders.” - The company announced that through their subsidiary, Pasithea Clinics, they will be able to start providing treatment at three of their UK accredited clinics. - Esketamine is a ketamine based nasal spray that has shown tremendous promise in helping [treatment-resistant depression](in adults. In what often seems like a constant stream of negativity from today’s media outlets, the news of Spravato’s approval is a beacon of hope for many suffering from severe depression. The pandemic has done a number on all of us but some worse than others. Keep KTTA in your watchlist, and be aware of any news related to Spravato’s ongoing clinical results. Little trouble in Big Tech The record inflation that’s sh*t everyone’s pants for the past couple weeks finally took a dump on tech stocks on Tuesday as the tech-heavy Nasdaq 100 saw a 0.50% drop. The sector-wide bloodbath stained companies such as Zoom, Peloton, DocuSign, Crowdstrike, and more. But Tesla’s fine. Definitely keep putting money in Tesla. - One possible reason for the correction is [Powell’s reappointment](, which signals stability but also the continuation of a dovish stance on inflation. That tends to freak markets out and tech stocks in particular are vulnerable to inflationary issues given the coked-out attitude investors take towards them. - Also, the 10-year Treasury yield rose to nearly a 1-month high. Treasury yields are seen as a safer alternative to stocks, and bond yields generally tend to [discount the present value of future profits](, which means tech stocks in particular lose when bond yields rise. - Silver lining: it could be worse. Markets struggled across the globe on Monday, with the result that the U.S. traded at its highest level since September 2020. It’s now worth 13 Turkish lira-- the [worst rate Turkey’s ever seen](-- because Erdogan holds the, uh, unusual belief that higher interest rates spur inflation (spoiler: they don’t). Sucks to suck, guys, but USA! USA! In the long term U.S. markets will probably be fine, but Goldman Sachs and Bank of America have both issued warnings against investing in tech, where they believe the fastest-growing stocks could see [more than 20% shrinkage]( over the course of the next year. Returning to safer investments like the S&P 500, treasury bonds, and European and Japanese markets will likely save you a headache later. Zooming Back to Reality An earnings beat and guidance raise should be good for stock performance right? As Lee Corso would say, “not so fast my friend”. Zoom’s (ZM) Q3 earnings call featured an earnings beat and raised guidance toward year end, and as a reward for their performance, the stock was beaten like a Jim Harbaugh coached team in a big game,[dropping 14.71% during trading.]( - Zoom reported revenue of $1.05B for the quarter, which was better than the company forecast of $1.02B and up 35% YoY. EPS came in at $1.11 vs. forecast of $1.08. - A forecast slowdown in the revenue growth rate caused some analysts to [cut price targets]( on ZM, like BTIG lowering its target from $460 to $400 and Deutsche Bank cutting from $350 to $280. - Turns out Zoom fatigue applies to its stock too. The pandemic poster child faces tough comps going forward as the novelty of seeing your friends and coworkers with digital backgrounds of Mt. Kilimanjaro or the cantina at Mos Eisley wears off. Quickly. Whether Zoom becomes an indispensable business tool or a short term (longest 15 days to slow the spread ever) workaround may determine its long term fate. The consulting industry may be a canary in the coalmine to watch, as client companies may balk at paying weekly travel costs to fly armies of business analysts and project managers across the country. India Swings the Banhammer Token Talk Yama, the Hindu god of death, is coming for digital currencies. The Indian parliament is[considering a bill]( that would ban private digital currencies and lay the groundwork for the creation of a central bank backed digital currency. India previously tried banning digital assets back in January, and hopes that the government’s view on digital assets had softened since then appear to be dashed. - The [proposed bill]( would prohibit the use of all non-government issued digital currencies, except for “certain exceptions to promote the underlying technology of cryptocurrency and its uses”, which we can only assume mean that Dogecoin and Shiba Inu are [spared Yama’s mace.]( - The Indian government trotted out the same tired FUD (fear, uncertainty, doubt) about terror financing and money laundering with the underlying meaning that governments hate currencies they can’t control. After all, cash has certainly never been used for any nefarious purposes. - The government also raised concerns that an unregulated digital asset market would “mislead the youth through over-promising” and as we all know, governments always have the kids’ best interest at heart. Digital Currency industry insiders[peg the Indian market]( at 15 million exchange users transacting volume of $6B, so it’s no wonder that the central government wants to exert greater control over it. If developing nations truly represent one of digital currency’s biggest use cases, then the sheer size of the Indian market may be too big to keep under any government’s thumb. Is this helping? Rumor has it While rumors of President Biden taking a hard stance on OPEC+ trickled out late last week, it was [announced Tuesday]( that the U.S. will release millions of barrels of oil from their strategic reserves. Please hold applause, it’s not that impressive. In coordination with China (really?), India, South Korea, Japan and Britain, the hope is that the added supply will help to reduce high energy prices. The U.S. has repeatedly called on OPEC+ to increase their production of crude oil only to have their calls go straight to voicemail. Apparently, Joey B got the hint. #rejectionishard - The total release of oil is likely to be between 65M-70M barrels with the US alone releasing 50M of that. As an aside, Britain said they would release 1.5M barrels. Way to do your part Britain. - [The world uses]( around 100M barrels of oil per day with the US consuming 20M of that. So the 50M barrels released will represent *checks notes* about 2.5 days worth of consumption? That should get us to the weekend. - OPEC+ has grappled with meeting the 400k barrels a day target agreed upon, and the US sees even that pace slow due to rising demand. Prices of US benchmark West Texas Intermediate Crude (WTI) fell from $79 to $75.50 in anticipation of Tuesday’s announcement, but rallied afterward to [close the trading session up 2.59%](. It is possible that this tactic by the US led group can backfire if OPEC+ decides to slow their pace of production in response. The one thing we do know is that the price of crude will remain volatile as the results of Tuesday’s actions are still unknown and will take some time to materialize. Link Roundup 📿 Other News Other News Link Roundup - [Krause House DAO raises groundbreaking 0.1% of money required to buy a basketball team]( - [More like Worst Buy – Best Buy falls 12% after gross margin decline]( - [Everything is bigger in Texas, including Samsung’s planned $17B chip factory]( - [Manscaped IPO proves that the pube-shaving industry is worth $1B]( - [$1.25 Tree just doesn’t have the same ring to it – Dollar Tree raises prices]( [Happy Thanksgiving from The Daily Setup and WKRP]( [Image] RagingBull, LLC 62 Calef Hwy. #233, Lee, NH 03861 [Unsubscribe from all RagingBull emails]( Questions or concerns about our products? 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