In today’s top stories, traders pile into Tesla stock, a hedge fund bets on Ocado falling 45% and analysts increase targets for Disney shares on the back of Bob Iger’s return to CEO. Meanwhile, a report reveals that the FTC is “likely” to file a lawsuit against Microsoft’s Activision deal and Bill Ackman shorts Hong Kong’s pegged dollar.
FTC ‘likely’ to file lawsuit against Microsoft deal
Activision Blizzard [ATVI] shares fell close to 1% on Wednesday and a further 4.5% in after-hours trading after a Politico report revealed that the Federal Trade Commission was “likely” to file an antitrust lawsuit to block it being acquired by Microsoft [MSFT]. The FTC is concerned that the $69bn proposed deal would give Microsoft an unfair advantage in the videogame market. A spokesperson for the company said it “is prepared to address the concerns of regulators”.
Ackman bets big on Hong Kong collapse
Bill Ackman has disclosed a short position against Hong Kong’s pegged dollar, despite the city propping up the currency since May. The founder of Pershing Square Capital revealed on Twitter that the firm owns a “large notional position” in Hong Kong dollar put options. Commenting on the position, DBS Bank strategist Carie Li said that “conditions are not favourable for selling Hong Kong dollar which will suffer negative carry”.
Wall Street turns bullish on Tesla
Despite hitting a fresh 52-week low on Tuesday, Tesla [TSLA] shares rebounded close to 8% on Wednesday and looked set to extend those gains on Thursday after Citi upgraded its rating to ‘neutral’ on the stock. Analysts at the firm reportedly said that “the year-to-date pullback had balanced out the near-term risk/reward”. The upbeat sentiment is echoed by retail traders, who have invested $403m in the past five days to make it the most bought stock.
Strategist sees CEO as “significant visionary”
In a recent interview with CNBC, Rob Luna, chief investment strategist at asset management firm Surevest, said that Disney [DIS] was a stock to watch following the return of Bob Iger as CEO. “Bob Iger is arguably probably the best CEO of the last two decades — what he’s done with Disney. Significant visionary,” he said. The stock had surged close to 9% on Monday after the announcement and has attracted increasing analyst upgrades.
Short seller sees more downside in Ocado
Short seller and CIO at Kintbury Capital Chris Dale expects Ocado [OCDO.L] shares to plummet 45% from Wednesday close of 657p. According to data from the UK’s Financial Conduct Authority, the short position is worth £32.6m, which is the equivalent of 0.59% of Ocado’s float — short seller interest had hit a peak of 0.82% on 31 October. Other firms shorting the stock include AQR Capital, Gladstone Capital and D.E. Shaw & Co.
Futu and Baidu beat on earnings
Chinese tech stocks have had a challenging year, but trading platform Futu has bucked the trend with double-digit growth in 2022 to-date. Its latest earnings report will add further confidence as Chinese stocks across the board have rallied in November. Baidu recently joined Futu in reporting strong revenue growth, which boosted the share prices of both companies. Goldman Sachs expects China equities to gain 20% if the country abandons its zero-Covid policy.
Michael Loukas of TrueMark on why diversification isn’t always key
Michael Loukas the CEO of TrueMark Investments, which is the owner of an ETF provider that embodies active management known as TrueShares. Michael spoke to Opto Sessions about his investment philosophy, the current trends within the tech sector and the actively managed TrueShares Technology, AI and Deep Learning ETF.
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