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Slow-Motion Crash Drags Futures Below 3,900; Yields, Cryptos Tumble

Slow-Motion Crash Drags Futures Below 3,900; Yields, Cryptos Tumble

The relentless slow-motion crash sparked by the Biden Fed (which is hoping…

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Slow-Motion Crash Drags Futures Below 3,900; Yields, Cryptos Tumble

The relentless slow-motion crash sparked by the Biden Fed (which is hoping that a market collapse will halt inflation) that has sent stocks lower for the past 6 weeks continued overnight, and Wall Street’s main equity indexes were set for more declines after losing $6.3 trillion in value since their late-March high as stubborn inflation in the world’s biggest economy bolstered the case for more aggressive monetary tightening by the Federal Reserve.

Nasdaq 100 futures were down 0.7% at 730am in New York, a day after the underlying gauge sank to its lowest since November 2020 on concerns that higher-than-expected inflation in April would lead to an even more aggressive pace of policy tightening by the Fed. S&P 500 were last down -1% and dropping below 3,900, the level. And with eminis trading around 3,900 means that stocks are now at bearish Morgan Stanley's year-end base case price target of 3900, and 100 points away from Michael Hartnett's Fed put of 3,800.

The dollar continues its relentless ascent, sending the euro to a five-year low while the yen also perked up, as investors took a cue from a rally in bonds and ploughed into “safe-haven” currencies on concerns about inflation risks to global economic growth. Meanwhile, bonds around the globe are surging as fears mount over an economic slowdown and traders start pricing in the next recession, sending the yield on 10-year German bunds and US Treasuries down more than 10 basis points to about 2.82%.

Among notable premarket moves, Disney shares dropped after the media giant said growth in the second half of the year may not be as fast as previously expected, while Beyond Meat slumped 24% as Barclays downgraded the stock and analysts slashed their price targets following underwhelming results. Bank stocks slump in premarket trading Thursday, set for a sixth straight day of losses. In corporate news, Carlyle Group is set to buy Chinese packaging firm HCP for about $1 billion. Meanwhile, Brookfield Asset Management said it plans to list 25% of its asset-management business in a transaction that would value the new entity at $80 billion. Economic data due late today include initial jobless claims. Here are all the notable premarket movers:

  • Disney (DIS US) shares drop 4.8% in premarket trading after the media giant said growth in the second half of the year may not be as fast as previously expected.
  • Apple (AAPL US) shares fall as much as 1.4% in premarket trading Thursday, putting them on course to open more than 20% below their January peak.
  • Beyond Meat (BYND US) shares slump 24% in US premarket trading as analysts slashed their targets on the plant-based food company following underwhelming results.
  • Riot Blockchain (RIOT US) -6.1% in premarket trading, Marathon Digital (MARA US) -5.8%, MicroStrategy (MSTR US)-10% and Coinbase (COIN US) -7.3%
  • Zoom (ZM US) shares decline as much as 4.5% in US premarket as Piper Sandler analyst James Fish cut the recommendation on the stock to neutral as he sees limited upside to paid video service.
  • Dutch Bros (BROS US) slumps 42% in premarket trading after the drive-thru coffee chain’s guidance lagged analyst estimates, though some analysts see the dip in shares as a buying opportunity.
  • Lordstown Motors (RIDE US) shares jump as much as 27% in U.S. premarket trading after the electric truck maker completed the sale of its factory to Foxconn.
  • Rivian (RIVN US) gains 2.9% in premarket trading after the electric vehicle startup reaffirmed its annual production guidance, even as it navigates through supply chain snarls.
  • Coupang (CPNG US) shares jump as much as 18% in US premarket trading after the Korean e- commerce firm reported a first-quarter loss per share that was narrower than analysts’ expectations.
  • Bumble (BMBL US) shares rise 8.3% in premarket after the company reported first-quarter results that beat expectations, despite currency risks and those related to the war in Ukraine.

Cryptocurrency-exposed stocks also fell as digital tokens resumed declines after the collapse of the TerraUSD stablecoin, overnight the largest stablecoin, Tether, broke the buck spooking markets further that the contagion is spreading.

The hotter-than-expected inflation reading for April raised concern the Fed’s hikes aren’t bringing down prices fast enough and policy makers may have to resort to a 75bps move, rather than the half-point pace markets have come to grips with. Worries such a shift would crimp economic growth, combined with Russia’s war in Ukraine and China’s struggles with Covid, are battering risk assets.

The data halted a minor rebound in US equities, which are set for their longest weekly streak of losses since 2011, as investors worried that hawkish moves by central banks at a time of surging commodity prices and slowing earnings growth would spark a recession. While some strategists have said the rout has now made stock valuations attractive, others including Michael Wilson at Morgan Stanley warned of a bigger selloff.

“What these wild market moves are telling us is that investors have very little idea of whether we’re near a short-term base, or whether we’ve got further to fall,” said Michael Hewson, chief market analyst at CMC Markets UK.

The higher-than-expected CPI figure may further fuel fears that the Fed will take policy higher than expected for longer than expected, draining precious liquidity from markets, which have until late been awash with it,” said Russ Mould, investment director at AJ Bell.  “Until we get a meaningful move lower in inflation, not only one print, but a consistent two, three, four prints moving in the right direction, this market may remain range bound,” Mona Mahajan, senior investment strategist at Edward Jones & Co., said on Bloomberg Television.

Citigroup Inc. strategists said growth stocks, including the battered tech sector, will likely remain under pressure as central banks tighten monetary policy, driving yields higher.  “Now that central banks are unwinding monetary support, growth stocks’ valuations have further to fall,” strategists including Robert Buckland wrote in a note. They are especially wary of growth stocks in the US, where the Nasdaq 100 is down 27% this year.

In Europe, the Stoxx 600 was down 2.2% with mining and consumer-products stocks leading declines. The Euro Stoxx 50 drops as much as 2.8%, Haven currencies perform well. The Stoxx 600 Basic Resources sub-index erased all YTD gains as a slide in metal prices and concerns about inflation fueled a selloff in the sector. Miners are the biggest laggard in the broader European equity benchmark on Thursday as major miners and steelmakers slip along with copper and iron ore prices. The basic resources sector (the sector is still second-best performing in Europe this year so far) fell as much as 5.6%, briefly erasing all YTD losses, and down to the lowest since January 3. Morgan Stanley strategists had downgraded miners to neutral on Wednesday, saying it’s time to take profits in the sector amid concerns inflation will lead to demand destruction. Here are the biggest movers:

  • Telefonica shares rise as much as 4.5% after the Spanish carrier reported what analysts said was a solid set of quarterly earnings.
  • STMicroelectronics gains as much as 4.1% as the chipmaker projects annual revenue of more than $20 billion for 2025-2027 period.
  • Compass Group climbs as much as 2.5%, adding to Wednesday’s 7.4% advance, with Morgan Stanley lifting its price target to a Street-high.
  • JD Sports rises as much as 3% after the UK sportswear chain said like-for-like sales for the 14-week period to May 7 were more than 5% higher than a year earlier.
  • AS Roma advances as much as 15% after US billionaire Dan Friedkin made a tender offer for the roughly 13% of the Italian football team he doesn’t already own.
  • The Stoxx 600 Basic Resources sub- index erases all YTD gains as a slide in metal prices and concerns about inflation fuel a selloff.
  • Rio Tinto declines as much as 6%, Glencore -7.3%, Anglo American -6.9%, ArcelorMittal -4.8%, Antofagasta -7.9%
  • Luxury stocks resume their declines after high US inflation bolstered the case for aggressive monetary tightening, deepening fears of an economic slowdown.
  • Kering slides as much as 5.6%, Hermes -5.5% and Swatch -3.7%
  • SalMar falls as much as 8.2% after the Norwegian salmon farmer published its latest quarterly earnings, which included a miss on operating Ebit.

Earlier in the session, Asian stocks resumed their slide after Wednesday’s modest gains, as US inflation topped estimates and new Covid-19 community cases in Shanghai damped prospects for a reopening.  The MSCI Asia Pacific Index fell as much as 2%, with tech giants Alibaba and TSMC weighing the most on the gauge. Chinese shares snapped a two-day advance after Shanghai found two infections outside of isolation centers, pushing back the timeline for a relaxation of growth-sapping lockdowns.  US inflation remained above 8% in April, keeping the Federal Reserve on the path of aggressive tightening. That prospect weighed on shares in Asia, as investors also factored in growth implications from continued lockdowns in the world’s second-largest economy. Markets appeared to be unimpressed by China’s Premier Li Keqiang’s comments urging officials to use fiscal and monetary policies to stabilize employment and the economy. Valuations for the MSCI Asia Pacific Index are hurtling toward pandemic lows as the index records a 29% decline from its 2021 peak, posting declines in all but one of the trading sessions so far this month.

“We’ve seen nearly the same amount of foreign investor selling in Asia as we saw during the global financial crisis, even though operating conditions aren’t as bad,” Timothy Moe, chief Asia-Pacific equity strategist at Goldman Sachs, told Bloomberg Television. “On our expected conditions over the next year, somewhere around 13 times should be a fair and appropriate valuation for Asian markets,” he added. Benchmarks in Indonesia and Taiwan were among the biggest decliners in the region, with the Jakarta Composite Index on the cusp of erasing gains for the year. Hong Kong shares also fell as the city intervened to defend its currency for the first time since 2019

In FX, the Bloomberg Dollar Spot Index rose to a fresh two-year high as the greenback climbed versus all of its Group-of-10 peers apart from the yen. The demand for havens sent the yield on 10-year German bunds and US Treasuries down more than 10 basis points. Stops were triggered in the euro below $1.0490 and 1.0450, weighed by EUR/CHF selling and yen buying across the board, according to traders. The yen rose by as much as 1.2% against the greenback as selling in stocks hurt risk sentiment. The BOJ indicated its lack of appetite for changing policy to help address a slide in the yen to a two-decade low during discussions at a meeting last month, according to a summary of opinions from the gathering. The Australian and New Zealand dollars fell on concern that lockdowns in China’s financial capital will extend, dragging economic growth in the world’s biggest buyer of commodities.

In rates, Treasuries extended Wednesday’s rally with yields richer by 6bp to 9bp across the curve, supported by risk-aversion as stocks extend losses. US 10-year yields around 2.82%, down 10bps on the session, and trailing gilts and bunds by 2.2bp and 3bp in the sector; intermediates lead the US curve, richening the 2s5s30s fly by 4bp on the day to tightest levels since March 23. Eurodollars are bid as well with the strip flattening out to early 2024 as rate-hike premium continues to erode. European fixed income extends gains. German and US curves bull-steepen; bunds outperform, richening ~12bps across the belly. Gilts bull-flatten, focusing on soft March GDP data over hawkish comments from BOE’s Ramsden.  STIRs are similarly well bid with red pack euribor, eurodollar and sonia futures all up over 10 ticks. The US auction cycle concludes with $22b 30-year bond sale at 1pm ET; Wednesday’s 10-year is trading more than 10bp lower in yield after 1.4bp auction tail. WI 30-year around 2.965% is above auction stops since March 2019 and ~15bp cheaper than April stop-out. Super-long sectors led gains in Japanese bonds even as the 30-year sale was seen sluggish.

In commodities, base metals were under pressure; LME tin slumps over 8%, zinc down over 3.5%. European natural gas surged as much as 13% on supply concerns. Crude futures drop, fading roughly half of Wednesday’s rally. WTI is down over 2% near $103.50. Spot gold trades a narrow range near $1,850/oz. European natural gas prices jumped as disruptions to a key transit route through Ukraine and a move by Moscow to retaliate against sanctions ramped up the risk of supply cuts. Shanghai found two Covid cases outside government-run isolation centers on Wednesday, according to state-run CCTV, dampening prospects for potential easing of lockdowns. Prices of iron ore, the biggest commodity export from Australia, also fell on the news.

Looking at the day, data releases include the US PPI reading for April, the weekly initial jobless claims, and UK GDP for Q1. Central bank speakers include the ECB’s De Cos and Makhlouf. And in the political sphere, US President Biden will be hosting ASEAN leaders at the White House, whilst G7 foreign ministers are meeting in Germany.

Market Snapshot

  • S&P 500 futures down 0.6% to 3,907.50
  • STOXX Europe 600 down 1.9% to 419.41
  • MXAP down 1.7% to 157.21
  • MXAPJ down 2.5% to 512.05
  • Nikkei down 1.8% to 25,748.72
  • Topix down 1.2% to 1,829.18
  • Hang Seng Index down 2.2% to 19,380.34
  • Shanghai Composite down 0.1% to 3,054.99
  • Sensex down 2.1% to 52,935.64
  • Australia S&P/ASX 200 down 1.8% to 6,941.03
  • Kospi down 1.6% to 2,550.08
  • Gold spot down 0.1% to $1,849.85
  • U.S. Dollar Index up 0.48% to 104.34
  • German 10Y yield little changed at 0.89%
  • Euro down 0.6% to $1.0449
  • Brent Futures down 2.0% to $105.32/bbl

Top Overnight News from Bloomberg

  • The EU is looking at creating bond futures and repurchase agreements to bolster its pandemic-era debt program
  • The BOE will have to raise interest rates further to control surging prices, and there’s a risk that the UK’s worst inflation crisis in decades will take longer to ease fully, according to Deputy Governor Dave Ramsden
  • The UK economy unexpectedly contracted in March. Gross domestic product fell 0.1% from February, when growth was flat. It meant the economy expanded just 0.8% in the first quarter, less than the 1% forecast by economists
  • UK Prime Minister Boris Johnson will spend the next few days considering whether the UK will introduce legislation to override its post- Brexit settlement with the EU, a move that risks sparking a trade war
  • A massive sell-off in cryptocurrencies wiped over $200 billion of wealth from the market in just 24 hours, according to estimates from price-tracking website CoinMarketCap
  • Finland’s highest-ranking policy makers President Sauli Niinisto and Prime Minister Sanna Marin threw their weight behind an application and Sweden’s government is likely to do so in the coming days
  • Sweden’s Riksbank’s target measure, CPIF, accelerated to 6.4% on an annual basis in April, the highest level since 1991, according to data released on Thursday. Economists surveyed by Bloomberg expected prices to rise by 6.2%

A more detailed look at global markets courtesy of Newsquawk

Asia-Pc stocks were pressured after the losses on Wall St where the major indices whipsawed in the aftermath of the firmer than expected CPI data and the DJIA posted a fifth consecutive losing streak. ASX 200 was lower amid heavy losses in tech and with financials subdued after flat earnings from Australia’s largest lender CBA. Nikkei 225 weakened with attention on earnings updates and with SoftBank amongst the worst performers ahead of its results later with the Co. anticipated to have suffered a record quarterly loss. Hang Seng and Shanghai Comp were subdued with early pressure from default concerns after developer Sunac China missed its grace period deadline and warned there was no assurance that the group will be able to meet financial obligations, although the mainland bourse recovered its earlier losses after further policy support pledges by Chinese authorities. SoftBank (9984 JT) - FY revenue JPY 6.2trln (prev. 5.6trln Y/Y). FY net profits -1.7trln (prev. +4.99trln). Foxconn (2317 TT) Q1 net profit TWD 29.45bln (exp. 29.76bln); sees Q2 revenue flat Y/Y, sees smart consumer electronics slightly declining Y/Y.

Top Asian News

  • Rupee Tumbles to a Record Low, Stocks Slump on Inflation Woes
  • SoftBank Vision Fund Posts a Record Loss as Son’s Bets Fail
  • Yen Rebound Tipped as Recession Fears Push Down Treasury Yields
  • More Defaults Seen Following Sunac’s Failure: Evergrande Update

European bourses are pressured as overnight risk sentiment reverberated into the region, in a continuation of the post-CPI Wall St. move; Euro Stoxx 50 -2.5%. US futures are lower across the board though the magnitude is less extreme, ES -0.6%; NQ fails to benefit from the yield pullback as participants focus on the normalisation's impact on tech. Walt Disney Co (DIS) - Q2 2022 (USD): Adj. EPS 1.08 (exp. 1.19), Revenue 19.25bln (exp. 20.03bln). Disney+ subscribers 137.7mln (exp. 134.4mln). ESPN+ subscribers 22.3mln (exp. 22.5mln) -5.0% in the pre-market.

Top European News

  • UK Retailers Sue Truckmakers Over Alleged Price Fixing
  • Rokos Raising $1 Billion as He Joins Macro Hedge Fund Surge
  • Siemens Abandons Russian Market After 170-Year Relationship
  • Hargreaves Tumbles as Peel Notes Macro, Geopolitical Impacts

FX

  • DXY tops 104.500 to set new 2022 peak as risk aversion intensifies.
  • Yen regains safe haven premium to buck broadly weak trend vs Dollar, USD/JPY sub-128.50 vs top just over 130.00.
  • Aussie and Kiwi flounder as commodities tumble on demand dynamics'; AUD/USD under 0.6900 and NZD/USD below 0.6250.
  • Euro and Sterling give up big figure levels with the Pound also undermined by worse than forecast UK data; EUR/USD down through 1.0500 then 1.0450, Cable beneath 1.2200 and eyeing 1.2150 next.
  • Swedish Crown holds up in wake of stronger than expected CPI and CPIF metrics; EUR/SEK straddles 10.6000.
  • Yuan crushed as PBoC and Chinese Government reaffirm commitment to provide economic support; USD/CNY 6.7900+, USD/CNH just shy of 6.8300.
  • Forint falls as NBH Deputy Governor contends that aggressive tightening period is over and future hikes likely more incremental.
  • HKMA picks up pace of intervention to defend HKD peg, CNB steps in to support CZK.

Fixed Income

  • Debt revival gathers pace amidst risk-off positioning elsewhere.
  • Bunds probe 155.00, Gilts reach 120.71 and 10 year T-note nudges 120-00.
  • BTP supply encounters few demand issues, unlike second US Quarterly Refunding leg ahead of USD 22bln long bond auction.

Commodities

  • WTI and Brent are pressured in what has been a grinding move lower during European hours; however, benchmarks were lifted amid Kremlin/N. Korea updates.
  • Currently, the benchmarks are lower by around USD 1.50/bbl.
  • IEA OMR: Revises down oil demand growth projections for 2022 by 70k BPD, amid China lockdowns and elevated prices. Overall decline of Russian supply by 1.6mln BPD in May and 2mln BPD in June; could expand to circa. 3mln BPD from July onwards. Click here for more detail.
  • OPEC MOMR to be released at 13:00BST/08:00EDT.
  • Indian refineries purchased 25-30mln barrels of Russian oil at a discount for delivery in May-June, according to Interfax.
  • Spot gold/silver are pressured amid the USD's revival, but, the yellow metal remains in relatively contained parameters around USD 1850/oz.

US Event Calendar

  • 08:30: May Initial Jobless Claims, est. 192,000, prior 200,000
  • 08:30: April Continuing Claims, est. 1.37m, prior 1.38m
  • 08:30: April PPI Final Demand MoM, est. 0.5%, prior 1.4%; YoY, est. 10.7%, prior 11.2%
  • 08:30: April PPI Ex Food and Energy MoM, est. 0.6%, prior 1.0%; YoY, est. 8.9%, prior 9.2%

DB's Jim Reid concludes the overnight wrap

It was all about the higher than expected US CPI report yesterday which added to Fed rate expectations, as well as hard landing expectations as revealed through the curve flattening that took place through the rest of the day. Longer dated Treasury yields fell (after initially spiking much higher) and equities fell sharply (S&P 500 -1.65%) after actually being higher for the first half of the US session. So a topsy-turvy day that kept the Vix above 30 for a fifth straight session.

In terms of the details of that report, headline monthly CPI surprised to the upside with a +0.3% gain (vs. +0.2% expected), whilst monthly core CPI also surprised to the upside at +0.6% (vs. +0.4% expected). Thanks to base effects from last year, the year-on-year numbers managed to decline in spite of the upside monthly surprises, but they were also higher than expected with headline CPI at +8.3% (vs. +8.1% expected), and core CPI at +6.2% (vs. +6.0% expected).

Looking at the components, what will concern the Fed is that there are plenty of signs that inflation pressures remain broad and can’t be pinned on transitory shocks like the spike in energy prices of late. For instance, owners’ equivalent rent (which makes up nearly a quarter of the inflation basket) was up +0.45%, which is its fastest monthly pace since June 2006. Rents also remained strong with a +0.56% increase, which is just shy of its February increase and still the second-highest since December 1987. Food prices (+0.9%) also continued to move higher in April, bringing their year-on-year gain to a 41-year high of +9.4%. One consolation might be that the Cleveland Fed’s trimmed mean (which removes the outliers in either direction) saw its smallest monthly increase since last August at +0.45%, even if it’s still increasing well above rates seen throughout the 2010s.

The fact the release surprised on the upside saw an immediate reaction across asset classes, with 10yr Treasury yields bouncing by more than +14bps intraday during the half hour following the report to 3.07%, before reversing all of this to end the day down -7.0bps to 2.92%. Ultimately the decline in real rates (-14.7bps) offset expectations of higher inflation (+8.1bps), but it was a different story at the front-end of the curve, where 2yr yields rose +2.5bps since the report was seen to raise the likelihood of larger hikes at the coming meetings, with the futures-implied rate for the December meeting rising +4.5bps on the day. In Asia, US 10 year yields are another -3.3bps lower with 2yrs flats. This has left the 2s10s curve at 24.3bps after trading as high as 48.5bps on Monday.

In terms of the reaction from Fed officials themselves, Atlanta Fed President Bostic said he would support +50bp hikes until policy reaches neutral, which suggests more +50bp hikes than just the next two meetings, which has been the common line from Fed speakers of late. Markets are placing a 58% chance on a +50bp hike at September, up from 49% the day before. Markets also increased the chance they place on the Fed being forced into a +75bp hike even at the June meeting, pricing a 14% chance versus 10% yesterday. We will also get the May CPI release ahead of the next FOMC meeting in June, but by that point they’ll be in their blackout period, so this is the last print they’ll be able to comment on ahead of their next decision, and will frame the chatter around whether 75bps might be back on the table at some point given inflation looks to be proving stickier than many had expected.

For equities, the CPI print drove indices lower at the open, but they bounced around all day as volatility remained elevated, ultimately closing near the lows. The S&P 500 fell -1.65%, led by tech and mega cap shares, while the Vix ended above 30 for the fifth straight session for the first time since the post-invasion bout of volatility gripped equity markets. As mentioned, tech stocks were the main underperformer, with the NASDAQ down by -3.18% as investors priced in faster hikes from the Fed this year. Separately in Europe, equities outperformed their US counterparts for a 3rd consecutive day, with the STOXX 600 posting a +1.74% advance but closing well before the US slump.

Whilst the main focus yesterday was on the US CPI report, there was significant central bank news in Europe as well after ECB President Lagarde put out a strong signal that July would be when the ECB starts hiking rates for the first time in over a decade. In her remarks, she said that the first hike “will take place some time after the end of net asset purchases”, and that “this could mean a period of only a few weeks”. A July hike would be in line with the call from our own European economists here at DB (link here), who see four consecutive quarter point hikes from July, taking the deposit rate up to +0.50% by year-end. That was then echoed by a separate Bloomberg report later in the session, which said that ECB officials were “increasingly embracing a scenario” where interest rates moved into positive territory by year-end. ECB policy pricing by the end of the year actually fell -1.3bps to 26.5bps, as a broader sovereign bond rally overpowered this.

With other ECB speakers having already been signalling their openness to a July hike, European sovereign bonds reacted more to the US CPI report than Lagarde’s remarks. So we ended up with a similar pattern to Treasuries, whereby yields surged following the US release before falling back to end the day lower on growth fears. Ultimately, that meant yields on 10yr bunds were down -1.5bps at 0.98%, and there was a significant narrowing in peripheral spreads too, with the gap between 10yr Italian yields and bunds down -9.9bps.

Asian equity markets are weaker overnight. The Hang Seng (-0.94%) is the largest underperformer across the region this morning after the Hong Kong Monetary Authority (HKMA) intervened into the currency markets for the first time since 2019 to defend the local dollar from capital outflows. The authority bought about HK$1.589 billion from the market to bolster the exchange rate in order to bring it back within the trading band i.e., between 7.75 and 7.85 versus the US dollar. Elsewhere, the Nikkei (-0.84%), Kospi (-0.56%) are also trading lower. Mainland Chinese stocks are showing a more mixed performance with the Shanghai Composite (+0.17%) higher while the CSI 300 (-0.07%) is a tad lower. Outside of Asia, US stock futures are flat but Euro Stoxx futures are catching down with the late US move last night and are around -2%.

According to the BOJ’s summary of opinions from the April 27-28 meeting, the board brushed aside the idea of countering sharp yen falls with interest rate hikes with several board members arguing in favour of maintaining the central bank’s massive stimulus programme.

Oil prices are lower in early Asian trade, taking a pause after Brent crude futures closed +4.93% higher last night. This morning, the contract is -1.15% down at $106.27/bbl as I type.

Elsewhere in markets, a significant story over the last 24 hours has been the significant price declines in a number of major cryptocurrencies. Bitcoin is at $27,617 as I type, a level not seen since December 2020. Coinbase’s share price was down a further -26.40% yesterday, bringing its losses over the last week alone to almost -60%.

A few other headlines worth highlighting. The Dallas Fed announced that Lorie Logan, the current manager of the Fed’s portfolio, would assume the role of President, which makes her a voter on the FOMC next year. Given her remit has been to manage the balance sheet, little is known about her views about monetary policy as of yet.

Finally on the Brexit front, there was a further ratcheting up in the comments between the UK and the EU over the Northern Ireland Protocol yesterday. UK PM Johnson said that “we need to sort it out”, and Levelling Up Secretary Gove said that “no option is off the table”. From the EU side however, Irish Foreign Minister Coveney said that the EU would need to react if the UK breached international law, and Bloomberg reported that the EU would likely suspend their trade deal with the UK if the UK were to revoke its commitments.

To the day ahead now, and data releases include the US PPI reading for April, the weekly initial jobless claims, and UK GDP for Q1. Central bank speakers include the ECB’s De Cos and Makhlouf. And in the political sphere, US President Biden will be hosting ASEAN leaders at the White House, whilst G7 foreign ministers are meeting in Germany.

Tyler Durden Thu, 05/12/2022 - 07:57

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Steps to building a more patient-centric industry

Lack of access, strict regulations, and demanding schedules have made it extremely difficult for patients to participate in
The post Steps to building…

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Lack of access, strict regulations, and demanding schedules have made it extremely difficult for patients to participate in clinical trials. A 2018 NIH survey found that patients felt clinical trial participation to be inconvenient and burdensome, and nearly half (49.0%) said it disrupted their daily routine. In 2021, a CISCRIP Perceptions and Insights Study reported more disruption to daily routines compared to previous years, citing length of visits, travel, and diagnostic tests as top burdens.

To ease this burden, the life sciences industry has been searching for ways to make clinical trials more accessible for patients and to drive participation numbers, increase participant diversity, and improve overall patient experience. For many patients, this change starts with choice.

A recent survey of clinical trial professionals found that more than two-thirds of respondents (61%) believe giving patients choice will have a positive impact on clinical research, and well over half (58%) said that their organisations plan to give patients the option to choose how they participate in clinical trials moving forward. Some examples of these choices can include video visits, phone visits, and remote monitoring.

As the industry focuses on creating a more holistic, inclusive patient experience, here are key steps to consider in order to help bridge the gap between clinical research and the patient experience.

Build a base in the community

According to the FDA’s 2020 Drug Trials Snapshot Report, only 8% of clinical trial participants are Black or African American, as compared to nearly 14% of the US population. The fact is, many minorities never learn about vital clinical trials in play, or that they’re eligible to participate. Subsequently, they are excluded, creating an evident gap in participants, and subsequently needed data on how treatments respond across different demographics of people.

Creating a broader, more inclusive patient experience starts with building a network of advocates who can help organisers meet patients where they are located and educate them about the availability and value of the trials. Initially, there needs to be a more proactive and sustained nationwide outreach effort to raise clinical trial awareness within minority communities.

It’s also important to partner with trusted people within minority communities, such as religious and government leaders that have the credibility needed to share clinical trial information to counter scepticism. If sponsors can partner with patient-advocacy groups to inform design, recruitment, follow-up, and even data collection (particularly for patient-reported outcomes), it will help to keep patients engaged longer and potentially derive higher quality data sets that can lead to better patient outcomes over the long run.

Embrace technology to expand reach

Technology – especially related to automation and the cloud – can help create a more flexible clinical trial model, thereby making it easier for patients to participate. Digital tools used in decentralised trials, remote enrolment tools, consent forms, wearables, and remote devices, as well as data capture, can help to expand overall access to clinical trials. For example, with remote monitoring, doctors and trial administrators can analyse all the data coming in and, if there’s a problem, they can act more quickly and respond back to the patient through a mobile device such as a smartphone.

Cloud platforms can open two-way communication channels for patients, doctors, and trial administrators to talk and share data, essentially in real-time. Some early examples of these capabilities were part of the US Centers for Disease Control and Prevention’s (CDC) v-safe program, developed by Oracle, which is used to track the effects of the COVID-19 vaccines through voluntary, scheduled survey prompts, and to remind people about boosters. Today, capabilities like this are being extended so that trial data from wearable devices and home-monitoring systems can be communicated directly to trial sites.

A new solution

One significant roadblock to clinical trial inclusion of minority groups has been location and transportation. Many potential participants lack transportation to and from clinical sites, and some trials are only held in large city hospitals, instead of smaller community hospitals that participants can sometimes access more easily. Thanks to decentralised trials and technology that collects data remotely, people from anywhere can participate.

One approach the industry has been exploring is to utilise community retail pharmacies as a central location for people to learn about and participate in clinical trials. By collaborating with pharmacy retailers, sponsors will have more opportunities for patient recruitment because they can offer patients the convenience and comfort of visiting familiar community sites.

For example, CVS and Walgreens have instituted flexible clinical trial models that combine patient insights, technology capabilities, and in-person and virtual-care options to engage broader and more diverse communities. The result is a much more expansive pool of participants and potentially much better information about populations where the drug is effective, and other populations where it might not be effective.

Keep it simple

There’s a notion that because the healthcare and life sciences industries are very complex, the systems that support them have to be equally complex. In fact, the opposite is true. Easier-to-use systems will increase participation rates, and we will have better outcomes as a result. With so many technology advancements at its disposal, the industry must find a way to bridge the divide between patient experience and clinical research. The patient journey must be a positive one, so that they will encourage others to participate.

Imagine, clinical research as an accessible care option to anyone. Technology has given us the opportunity to make this goal a reality. But as an industry, we must innovate to bring new experiences to market and improve the clinical research ecosystem for patients, healthcare professionals, sponsors, and regulators.

About the author

Katherine (Kathy) Vandebelt is global head of clinical innovation at Oracle Health Sciences. With over thirty years of experience in clinical research working in different geographies and across various TA, Kathy has worked with various organisations to advance their clinical operations and business processes to a better operating model. She believes patients are the most important constituent in clinical development and provide the necessary information to assess the safety and efficacy of new medicines. She strives to introduce new experiences and make the clinical research ecosystem better for patients, healthcare professionals, sponsors, and regulators using the power of technology.

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Meta ‘powering through’ with Metaverse plans despite doubts — Zuckerberg

Billions of dollars have been poured into Meta’s virtual world with little return on investment, but CEO Mark Zuckerberg says he is holding fast.

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Billions of dollars have been poured into Meta’s virtual world with little return on investment, but CEO Mark Zuckerberg says he is holding fast.

Meta CEO Mark Zuckerberg is still hopeful about the company’s Metaverse plans regardless of the billions of dollars it’s sucking up from the company, claiming “someone has to build that.”

Appearing remotely for an interview at the Nov. 30 DealBook Summit in New York, Zuckerberg was asked his thoughts on whether the tech giants’ Metaverse play was still viable given its cost and the doubts cast over the platform, answering:

“I think things look very different on a ten-year time horizon than the zone that we're in for the next few years [...] I'm still completely optimistic about all the things that we've been optimistic about.”

He added part of “seeing things through” in the longer term was “powering through” the doubts held about its ambitions.

Meta's latest earnings, released on Oct. 26, revealed the largest-ever quarterly loss in its metaverse-building arm Reality Labs dating back to the fourth quarter of 2020. Zuckerberg’s virtual reality has cost $9.44 billion in 2022, closing in on the over $10 billion in losses recorded for 2021.

On the earnings call at the time Zuckerberg was unfazed by the cost, calling its metaverse the “next computing platform.” He doubled down on this claim at DealBook:

“We're not going to be here in the 2030s communicating and using computing devices that are exactly the same as what we have today, and someone has to build that and invest in it and believe in it.”

However, Zuckerberg admitted that the plans have come at a cost, Meta had to lay off 11,000 employees on Nov. 9 and the CEO said it had “planned out massive investments,” including into hardware to support its metaverse.

He said the company “thought that the economy and the business were going to go in in a certain direction” based on positive indicators relating to e-commerce businesses during the height of the COVID-19 pandemic in 2021. “Obviously it hasn't turned out that way,” Zuckerberg added.

“Our kind of operational focus over the next few years is going to be on efficiency and discipline and rigor and kind of just operating in a much tighter environment.”

Despite the apparent focus from Meta to build its metaverse, Zuckerberg claimed 80% of company investments are funneled into its flagship social media platforms and will continue that way “for quite some time.”

Investments in Reality Labs are “less than 20%” at least “until the Metaverse becomes a larger thing” he said.

Related: The metaverse is happening without Meta's permission

Of the 20% invested in Reality Labs, Zuckerberg said 40% of it goes toward its Virtual Reality (VR) headsets with the other “half or more” building what he considers “the long-term most important form factor [...] Normal-looking glasses that can put holograms in the world.”

Zuck takes bite at Apple

Zuckerberg also took a few jabs at its peer tech company Apple regarding its restrictive App Store policies, the likes of which have placed restrictions on crypto exchanges and nonfungible token (NFT) marketplaces, saying:

“I do think Apple has sort of singled themselves out as the only company that is trying to control unilaterally what apps get on a device and I don't think that's a sustainable or good place to be.”

He pointed to other computing platforms such as Windows and Android which are not as restrictive and even allow other app markets and sideloading — the use of third-party software or apps.

He added its been Meta’s commitment to allow sideloading with its existing VR units and upcoming Augmented Reality (AR) units and hoped the future Metaverse platforms were also open in such a manner.

“I do think it is it is problematic for one company to be able to control what kind of app experiences get on the device.”

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Nifty News: Porsche 911 NFTs, BMW files Web3 trademarks, Baby Shark’s NFT game and more…

BMW and Porsche have both recently ramped up their own Web3 plays, while Baby Shark is dipping into the blockchain gaming sector, but just for kids.

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BMW and Porsche have both recently ramped up their own Web3 plays, while Baby Shark is dipping into the blockchain gaming sector, but just for kids.

Porsche to launch 7,500 NFTs for use in a ‘virtual world’

German luxury car manufacturer Porsche has suggested it will be significantly ramping up its Web3 efforts after unveiling an upcoming NFT project consisting of 7,500 customizable tokenized vehicles.

In a Nov. 29 announcement, Porsche stated that the NFTs will be launched in January, and users will be able to customize various aspects of the cars in relation to performance and appearance.

The NFT art itself is being designed by designer and 3D artist Patrick Vogel, with all pieces revolving around the famous Porsche 911 model.

Notably these virtual assets will be designed in Epic Games’ Unreal Engine 5, suggesting that gaming integrations are afoot.

NFT car designs: Porsche

The company gave a sneak peek into the project at the Art Basel conference in Miami on Nov. 30. While specific details have not been mentioned, the company noted that owners will be able to use the cars in the “virtual world,” most likely meaning some sort of Metaverse.

More broadly, Porsche suggested that it is looking to significantly ramp up its exposure to Web3 moving forward, with the announcement noting that:

“Digital art is just one aspect of Porsche’s Web3 strategy. The sports car manufacturer is working to integrate the potential of blockchain technology into existing and future processes and solutions.”

Porsche previously had a hand in launching soccer-themed NFT collectibles in June 2021 as part of a project called Fanzone, but now appears to be taking the tokenization of its cars more seriously.

BMW to get Web3 trademarks

Speaking of German luxury car manufacturers, BMW has reportedly applied to trademark its logo in relation to a host of Web3 products and services.

The move was highlighted by USPTO licensed trademark attorney Mike Kondoudis, who frequently shares news regarding Web3 trademark applications in the U.S. from major companies.

BMW outlined intentions for its logo to span across collectibles such as virtual clothing, footwear, headwear and vehicles, while also indicating plans for downloadable virtual goods such as online environments and games.

Baby Shark’s Web3 arc

Content from Pinkfong’s massively popular children’s song/music video Baby Shark is set to be tokenized as part of a family-focused blockchain game.

Pinkfong reportedly penned a licensing agreement with Toekenz Collectibles to create and issue Baby Shark characters in a child safe digital environment.

Baby Shark NFT partnership: Toekenz

Toekenz Collectibles is an NFT platform targeted at children aged 12 and under, and the focus of the game is to educate kids aged five to nine “about the trading economy of digital collectibles.”

The kids will also be able to customize the NFT art to their own liking, and even participate in a Tokenz DAO where they “can exercise democratic decision-making.”

This is not Pinkfong’s first dip into NFTs, Cointelegraph previously reported that the South Korea-based company launched a series of limited editions Baby Shark NFTs in December last year.

Related: Two Bored Apes sell for $1M each: Nifty Newsletter, Nov. 23–29

Deadmau5 rolling out music metaverse

A Web3 startup co-founded by popular crypto-friendly DJ Deadmau5 (Joel Zimmerman) is gearing up for the launch of a music and gaming focused Metaverse platform.

Announced at the Art Basel event on Nov. 29, the start-up known as Pixelynx stated that the Polygon-based platform will launch this week, and kick things off with an Augmented Reality (AR) scavenger hunt set on Miami Beach.

The firm’s CEO and co-founder Inder Phull described the AR scavenger hunt as a “Rock Band meets Pokémon Go experience,” in which virtual gaming features are merged with real locations on maps via smart devices.

Users who hold Deadmau5’s Droplet NFTs will gain early access to Pixelynx’s metaverse with the platform aiming to provide a host of virtual experiences for fans of particular musicians and artists.

More Nifty News

NFTs depicting the ongoing protests in China against the country’s tough zero-tolerance COVID-19 policy have found their way to the NFT marketplace OpenSea at the tail end of November.

On Nov. 30, decentralized exchange (DEX) Uniswap announced that users can now trade NFTs on its native protocol. The function will initially feature NFT collections for sale on platforms including OpenSea, X2Y2, LooksRare, Sudoswap, Larva Labs, X2Y2, Foundation, NFT20, and NFTX.

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