3 Hot Penny Stocks to Watch in Mid-January 2022
With penny stocks and blue chips pushing up today following a dismal morning trading session, many investors are excited about the future. The big news today came as Fed Chair Jerome Powell’s testimony was regarded with positivity. Right now, those who invest in penny stocks and stocks at large, are concerned about the future. However, a statement from JPMorgan Chase CEO, Jamie Dimon today, could be a reason to build a bullish case for the future.
Today, the finance mogul stated that “We’re going to have the best growth we’ve ever had this year, I think since maybe sometime after the Great Depression. Next year will be pretty good too. The consumer balance sheet has never been in better shape; they’re spending 25% more today than pre-Covid. Their debt-service ratio is better than it’s been since we’ve been keeping records for 50 years.”
This news is echoing around the stock market as investors work to cope with fears surrounding the future of the pandemic. And while there are plenty of unknowns to consider right now, there is also a lot to be excited about. Some believe that the Omicron variant could lead to the pandemic becoming endemic in the long term.
And, this excitement coincides with positive labor reports and the Fed raising rates. So, while there is a lot to be concerned about, the overwhelming sentiment in the market is that 2022 could be a great year for all. Considering this, let’s take a look at three penny stocks to add to your mid-January watchlist.
3 Penny Stocks to Add to Your Watchlist Right Now
- Phunware Inc. (NASDAQ: PHUN)
- Black Diamond Therapeutics Inc. (NASDAQ: BDTX)
- Transocean Ltd. (NYSE: RIG)
Phunware Inc. (NASDAQ: PHUN)
While PHUN stock’s gain of around 2.8% today is nothing to write home about, it is substantial. In the past twelve months, shares of PHUN stock have jumped by over 115% which is no small feat.
If you’re not familiar, Phunware is a MaaS or multiscreen-as-a-service that offers products, solutions, data, and SDKs or software development kits. Phunware states that it has approximately one billion active devices that touch its platform each month. Only a week or so ago, the company announced two new supplier relationships for its high-performance computers via its LYTE business unit.
“With these new strategic supplier relationships, we took the guesswork out of selecting the right personal computer systems for power users’ needs. Phunware launched these four newly optimized personal computers designed specifically for high-end gamers, traders, streamers, and cryptocurrency miners in conjunction with CES in Las Vegas.”The VP and General Manager of LYTE by Phunware, Caleb Borgstrom
This is all very exciting news for Phunware and should be an exciting prospect for the company moving forward. Right now, there is also a major emphasis on tech penny stocks, with Phunware being a popular company to watch. Considering this, will PHUN be on your list of penny stocks to buy this month?
Black Diamond Therapeutics Inc. (NASDAQ: BDTX)
One of the bigger gainers of the day so far is BDTX stock, which pushed up by around 8.5% at midday. This is a sizable gain and reflects a big announcement made by the company during premarket trading today. Today, the company announced an FDA allowance of its IND application for BDTX-1535. If you’re not familiar, this is an inhibitor of EGFR for treating Glioblastoma and non-small cell lung cancer.
“We are incredibly pleased to announce the FDA allowance of our IND, representing a significant milestone for Black Diamond as we continue to mature our pipeline of MasterKey therapies.
Based on the unique approach of our MAP discovery engine platform, we believe that BDTX-1535 is well-positioned to address the unmet needs of EGFR mutant GBM and NSCLC with robust brain penetration to ensure adequate CNS exposure and potent and selective inhibition of EGFR mutations.”The CEO of Black Diamond Therapeutics, David Epstein, Ph.D.
For some context, Black Diamond is an oncology-based biotech penny stock working on novel MasterKey therapies. The company utilizes a MAP drug discovery engine that can allow it to produce better and more effective therapies. So, with that in mind, do you think that BDTX stock deserves a spot on your penny stocks watchlist?
Transocean Ltd. (NYSE: RIG)
RIG is a penny stock that we’ve covered numerous times over the past few months due to its substantial intraday gains. And again today, shares of RIG stock are up by around 6.3%. This brings its one-month total to roughly 20% and over 28% during the past twelve months. While no news has come out of the company in the past few weeks, there is an overwhelming amount of bullish sentiment in the energy industry right now.
The most recent announcement from the company came back in November when it announced its Q3 2021 results. In the results, Transocean posted $626 million in drilling revenue, with a 98.1% efficiency. Its net loss came in at around $0.20 per diluted share with an adjusted EBITDA of $245 million. These results are encouraging although they are slightly lower than the previous quarter.
With a company like Transocean, we have to consider the overall state of the oil and gas sector. This coincides steeply with the number of Covid cases and the overall trends regarding the pandemic. Whether this makes RIG stock worth buying or not is up to you.
Are Penny Stocks Worth Buying Right Now?
If you’re looking for the best penny stocks to buy in 2022, there are hundreds of options to choose from. Although not all are truly worth buying, utilizing a trading strategy can help to avoid losses. In addition, understanding exactly what is going on in the stock market, can be the difference between making money with penny stocks and the opposite.
So, while there is a lot to consider in 2022, these factors can also be used as an advantage. Right now, shifting your trading strategy to adapt to the present day and what is going on as it relates to the day-to-day in the market. With all of that in mind, are penny stocks worth buying right now or not?nasdaq stocks pandemic cryptocurrency penny stocks oil
Monkeypox: demand for vaccines is outstripping supply – this is what’s causing the shortages
Chronic weaknesses in our global vaccine manufacturing and distribution systems may broadly be to blame.
Over 30,000 cases of monkeypox have been reported in more than 80 countries worldwide in 2022. Most are in countries that have never previously reported monkeypox. While monkeypox is not as transmissible as many respiratory infections (such as COVID-19), it’s still important to curb the spread.
One way to control spread is by vaccinating vulnerable people. Fortunately, we already have vaccines which are very effective at preventing monkeypox. But as case numbers continue to rise, reports are emerging that demand for vaccines is outstripping supply in many parts of the world currently seeing an outbreak, including the US, UK and Europe.
There are a number of reasons why we are seeing shortages of the vaccine used to protect against monkeypox. Broadly, it’s due to chronic weaknesses in our global vaccine manufacturing and distribution systems, which make it especially difficult to supply the vaccines needed to protect against new infections and outbreaks.
The vaccine currently being used to protect against monkeypox is the smallpox vaccine, which works because the monkeypox virus is so closely related to smallpox.
Until now, the smallpox vaccine has been a niche product because it’s not been needed since smallpox was eradicated in 1980. Pharmaceutical companies can’t afford to manufacture vast numbers of doses just in case, and few governments can justify buying a vaccine that isn’t used. This means the vaccines currently being administered are from emergency stockpiles that were created to respond to an accidental (or deliberate) release of smallpox.
As such, there are limited stocks and production capacity globally, so demand is rapidly outstripping supply. Even the US, with one of the largest smallpox vaccine stockpiles, recently ordered 2.5 million additional doses in response to the monkeypox outbreak. But there are reports that the factory in Denmark which makes the world’s only smallpox vaccine approved for monkeypox is temporarily closed, which may further impact the world’s ability to source more vaccine doses. And unfortunately, transferring production to other facilities is not straightforward.
One particular problem for vaccine manufacturers is that it’s hard to predict when or where big outbreaks of infections may happen. Of course, there are some infections that we know consistently require a regular supply of vaccines – such as the influenza virus. But while 1 billion influenza vaccines are produced globally each year, it still takes approximately six months from picking the most important new strains to manufacturing and rolling out jabs.
So even with vaccines in high demand, it isn’t simple to manufacture more doses. This is why we are still striving to innovate ways to rapidly produce new vaccines affordably and at a very large scale.
Vaccines are inherently complicated to make. Because they are made from relatively fragile and complex biological materials (such as a virus), the product has to be exactly right every time. If the formula changes even slightly, it might not work as well – or even increase the risk of side-effects.
Adding to this challenge is the fact that different vaccine products may be manufactured by different methods. For example, the equipment needed to produce a viral vaccine (such as the smallpox vaccine used against monkeypox) will be very different to that used to make COVID-19 RNA vaccines. It’s also slow and expensive to test any necessary modifications or improvements that may be needed to make a vaccine safer and more effective.
Surprisingly, even some simple processes common to all vaccines and other medicines – such as filling doses into vials for distribution to patients – still have a mismatch of capacity. Vaccines are usually manufactured in different locations to packaging facilities, raising logistical hurdles (such as strictly controlled refrigeration requirements) that can further delay distribution. These facilities are used for many different medicines and are usually fully booked years in advance; schedules that are still recovering from COVID-19 disruptions may now be experiencing urgent changes to package the smallpox vaccine from stockpiles.
It also isn’t just a case of developing new monkeypox vaccines that are easier to manufacture. Even with major recent scientific progress, it would take many months to develop a safe and effective new vaccine. For monkeypox, it’s far quicker and simpler to use the existing smallpox vaccine.
What can be done?
Smallpox vaccine production is likely to be increased to meet demand. But until this happens, many countries will have to make best use of what supplies they can access, and rely on other strategies to help curb the virus’s spread.
The most effective way to prevent monkeypox causing further harm is by using an integrated, locally led public health response – vaccines are just one part of this. Testing and contact tracing is vital. If enough infected people in a region can be identified and supported to isolate while they’re infectious, transmission can be blocked.
Given the vaccine shortages, we expect that people don’t need two vaccine doses to be protected against monkeypox. This is why vaccinating the most at-risk groups with one dose now, paired with other public health measures, is the most effective strategy for curbing the spread of monkeypox – especially while vaccine supplies are limited. Second doses can be administered to maximise immunity when supplies do become available.
The current monkeypox outbreak is yet another reminder of the importance of investing in global health, and ensuring there’s more equal access to vaccines and other medical interventions that can help prevent the spread of harmful diseases.
Alexander Edwards does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.stocks covid-19 vaccine testing vaccine production rna spread transmission europe uk
Is housing inventory growth really slowing down?
The problem with new listings declining now is what will happen if mortgage rates make a solid push lower.
The post Is housing inventory growth really…
One of the most important housing market stories in recent weeks has been the decline in new listings, which has slowed the growth rate of total inventory. What does this mean? Some have said this is evidence of a soft landing for housing since we are in August and it doesn’t look like we are going to even get to the peak inventory levels we saw in 2019 this year, or even breach the lower levels of 2019 on the national data.
From the National Association of Realtors:
What I want to talk about is the concern I’ve had throughout this post-COVID-19 housing market: When will we get total inventory back into a range of 1.52 million to 1.93 million? Once that happens, I can finally take the savagely unhealthy housing market theme off my talking points.
First let’s take a look at the data.
Clearly, we are seeing a slowdown in new listings as the data has been negative now for months. One thing that I have stressed is that higher mortgage rates can create a slowdown in demand and thus allow more inventory to accumulate through a weakness in demand. After March of this year when rates were rising, this was the case, especially when rates ranged between 5% to 6%. Inventory growth is happening much like we saw in 2014 — the last time total inventory grew — which was also the last time mortgage purchase application data went negative year over year.
However, inventory accumulation due to weakness in demand is only one of many ways to see inventory increase. If you really want to see inventory grow to 2019, 2016, 2014 or even 2012 levels, you need a healthy amount of new listing growth each year. We aren’t talking forced sellers, foreclosures or even short sellers. With just traditional new listings and with higher rates and time, we should be able to hit peak 2019 inventory levels.
The problem with new listings declining now is what will happen if mortgage rates make a solid push lower. At that point housing inventory could slow even more, pause, and in some cases fall again due to demand. If mortgage rates peaked at 6.25% or 6.50%, that means that the next big move should be lower and that is a risk to getting balance back into the system.
How low do rates need to go?
Mortgage rates have made a move of 1.25% in recent week and I have talked about how low they need to go to make a material shift in the markets. Looking at the most recent mortgage purchase application data, I haven’t seen anything yet to show that demand is coming back in the meaningful way. In fact the recent data shows that even though we saw a positive 1% move week to week, the year-over-year data is still down 19%.
So as of now, the growth rate of inventory slowing down is a supply issue more than demand picking up in a meaningful way. This is why if rates do fall, we will have more supply and more choices for borrowers, who in some areas won’t have to get into a bidding war for a home. This is something I will be keeping an eye on for the rest of the year, since I do have all six of my recession red flags up, which historically means that rates and bond yields fall.
Two things that I believe are key for a soft landing are rates falling to get housing back in line and inflation growth falling so the Fed can stop with the rate hikes and start cutting rates if the economic data gets even worse.
The recent inflation data did surprise the downside a bit, sending the bond market rallying, stocks higher and mortgage rates falling.
However, we are far from calling it a victory as inflation growth rate is still very high and we do have some variables that can create supply shortages, such as war and aggression by other countries.
For today, people cheered the growth rate of inflation falling as they know this is the biggest driver of the Federal Reserve’s hawkish tone and more aggressive rate hikes. Also, in general, the mood of Americans is much better when gasoline prices are falling and not rising. However, we need much more aggressive monthly prints heading lower for the Fed to be convinced that inflation is no longer a concern.
All in all, the decline in new listings does warrant a conversation on how much more growth we will see for the rest of the year. Inventory data is very seasonal and traditionally we see inventory start to fall in October as people start getting ready for the holidays and the New Year, and then in the spring and summer inventory pops up again.
I would remind everyone that the growth rate of inventory, working from all-time lows, was aggressive in the last few months, so some context is needed if we do see some weekly declines in inventory during the summer months. For now, this is due to a lack of new sellers rather than demand picking up. If demand starts to pick up due to falling rates, that is an entirely different conversation we will have, but we haven’t crossed that bridge yet.
Just remember that American homeowners are just in much better shape these days.
I know the professional grift online since October of 2021 was that a massive wave of millions of people were going to list their homes to sell at any cost to get out before the housing market crashed.
However, homeowners don’t operate this way. A traditional home seller is a natural homebuyer, buying another property when they sell. They don’t sell their house to be homeless or purposely sell to rent at a higher cost for no good reason. If we get a job loss recession we can have a further discussion of credit risk profiles, but for now, it shouldn’t be too shocking that new listings are declining, except for the fact it’s happening sooner than later in the year.recession covid-19 stocks fed federal reserve mortgage rates housing market recession
US CPI eases substantially to 8.5% but the Fed yet to “hit the brakes”
US consumers received a welcome break from the meteoric rise in prices with the July CPI ‘easing’ more than anticipated to 8.5% Y-o-Y. The figure moderated…
US consumers received a welcome break from the meteoric rise in prices with the July CPI ‘easing’ more than anticipated to 8.5% Y-o-Y.
The figure moderated from 9.1% in June owing to a fall in surging gasoline prices as the summer driving season came to a close.
Forecasts had suggested that the CPI may only fall to 8.7%.
Prices of key commodities such as corn, wheat and copper also declined by 20.4%, 27.7% and 13.5% compared to 3 months ago at the time of writing.
Buoyed by renewed optimism, the S&P 500 has risen by 2.1% thus far during today’s session.
Yet, the rate of inflation is still far above the Fed’s stated 2% target.
Core CPI which excludes volatile energy and food items from the main basket stayed unchanged at 5.9% Y-o-Y while increasing by 0.3% on a monthly basis, significantly below July expectations of 0.7%.
Pimco economists Tiffany Wilding and Allison Boxer noted that although headline inflation has eased, core CPI has stayed firm, and has even seen an uptick in related data released by the Fed’s regional institutions.
The July reading showed the sharpest Y-o-Y dip since March 2020, when CPI fell from 2.3% in February to 1.5% as the initial lockdowns took effect.
American families continue to battle sky-high prices amid declining real wages. Simon Moore, a contributor at Forbes magazine adds that “price increases for many other areas of the economy still remain concerning for the Fed.”
The broad-based nature of inflation has meant essentials such as food, rent, and health services are continuing to see an uptick despite a lower aggregate number.
For instance, the Bank of America noted that the average monthly rent has risen by 16% for those in the youth demographics.
The substantial dip in the CPI has proved to be a bit of a surprise following the latest jobs report which registered an increase of 528,000 in July, with the unemployment rate falling to a low of 3.5%.
The labour market continues to remain unnaturally tight despite the Fed’s overall hawkishness, two consecutive quarters of GDP contraction, and reports of big-tech lay-offs earlier in the year.
A tighter job market usually implies more competition for talent, higher wages and ultimately more spending. More spending tends to push up consumer inflation necessitating rate hikes.
As of July 2022, the U.S economy has been able to replace the 22 million jobs that were lost amid covid lockdowns, leading to predictions of a “jobful recession.”
Economists argue that this unique situation may be fueled in part by ageing demographics and a sharp decline in immigration during the course of the pandemic.
A key concern for the Federal Reserve is falling labour productivity in the economy. The output per worker reduced for a second consecutive quarter to -4.6% Y-o-Y, having registered a fall of 7.4% in the first three months of the year.
Q1 marked the deepest cut in labour productivity since records began in 1948, 74 years ago. This was reinforced by the weakness in GDP data that contracted in both Q1 and Q2, contrasting with the positive signals from the headline jobs figures.
At the same time, unit labour costs increased 10.8% in Q2, although real wages have contracted 3.5% over the past year.
Can we expect a pause in rate hikes?
Bluford Putnam, Managing Director & Chief Economist, CME Group, wrote “…factors has changed course in the past six to 12 months and is no longer likely to be a source of future inflation”
Elevated goods demand due to the pandemic and ongoing lockdowns have eased markedly; supply chain disruptions will take time to alleviate completely but significant strides have been made in this regard; the gigantic fiscal stimulus injected during the covid crisis has largely run its course; central banks are finally reducing their balance sheets; while policymakers have embarked upon the withdrawal of rock-bottom interest rates. These are all sources of price rise that have seemingly turned the corner.
In addition, gasoline prices are likely to ease for the foreseeable future, while WTI and Brent have fallen 4.7% and 2.4%, respectively over the past month.
However, Bill Adams of Comerica Bank has been reluctant to call a peak to inflation and expects that the US is at risk of “another energy price shock” over the winter.
The conduct of monetary policy has never been a clear-cut matter. The judgement of monetary authorities is paramount while projecting into the future has always been fraught with known and unknown unknowns.
The relatively sharp decline in CPI, contracting GDP and tightness in the job market tell a muddled tale.
For the average householder, costs are punitive, and inflation is likely to stay sticky.
However, the New York Fed in its July survey of expectations found that inflation expectations of the ‘general public’ have followed gasoline and broader energy prices lower, with one year ahead expectations falling to 6.2%.
Since inflation expectations are central to the monetary policy equation, once again, we find that supply-side factors not under the control of central banks may have influenced public sentiment and consumer behaviour more so than simply tighter policies.
In light of the likely easing among key inflationary sources, CME’s FedWatch Tool reports that there is a 60.5% probability of a 50 bps hike in September, while there is a 39.5% chance of a third consecutive 75 bps hike.
This is in spite of the fact that Jerome Powell believes that the Fed has been able to achieve the neutral interest rate during its last meeting – a level where the economy is neither constrained into contraction nor incentivized to expand.
Putnam states that “any level of short-term rates that is below a reasonable view of inflation expectations remains accommodative”, resulting in the Fed taking “its foot off the accelerator, but it has not hit the brakes. “
Moore points out that “Inflation is starting to fall, but still not by as much as the Fed would like and it may be some time before they can declare any sort of victory”
For now, all eyes will be on tomorrow’s Producer Price Index data and the likely passing of the controversial Inflation Reduction Act in the coming days.
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