Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Dollar 20-Year High, Rivian Block Sales, Chinese Trade - What's Moving Markets

Economy May 09, 2022 06:37AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters

By Geoffrey Smith -- The dollar hit a 20-year high as global risk aversion mounts in the wake of Friday's employment report. Ford and (apparently) Amazon are getting rid of large amounts of Rivian stock with block sales that will raise eyebrows at those who were persuaded to buy into the IPO at three times the price only a few months ago. The signal that sends about valuations means that stocks are set for another rocky day. China's export growth slows to a crawl in April as Shanghai's port was shut by COVID. Still, things could be worse. You could be Vladimir Putin, holding a Victory Parade while your armed forces still struggle no closer to subduing Ukraine after 10 weeks of fighting. Here's what you need to know in financial markets on Monday, 9th May.

1. Dollar hits 20-year high as jobs report fails to dispel rate fears

The dollar continued to surge in the wake of Friday’s employment report for April, which did nothing to alleviate concerns of higher U.S. interest rates or fears of what they will do to the world economy.

The dollar index, which tracks the greenback against a basket of six developed market currencies, touched a high of 104.205 before paring its gains to trade at 103.880 by 6:30 AM ET (1030 GMT), a gain of 0.2% on the day. Gains were across the board.

The dollar also gained 0.8% against the offhore yuan, after China’s trade data for March showed annual growth in exports slowing to only 3.9% from over 14% in February, hurt by the month-long COVID-driven disruption to the country’s largest port at Shanghai. The dollar also hit a record high against the Indian rupee.

Digital currencies also suffered, with Bitcoin falling 3.3% to test its low for the year, while Ethereum fell 4.2%.

2. Early investors pile out of Rivian

Two of Rivian Automotive's (NASDAQ:RIVN) big early backers are reducing their stakes in the company via big block sales, according to various reports.

CNBC reported on Sunday that Ford (NYSE:F) will place 8 million shares of its total holding of 102 million in the electric van maker in an accelerated book-building process led by Goldman Sachs (NYSE:GS). J.P. Morgan (NYSE:JPM), meanwhile, is set to sell between 12 million and 13 million Rivian shares on behalf of another big shareholder. The seller wasn’t named but is widely believed to be Amazon (NASDAQ:AMZN).

The blocks are set to be sold at $26.90, a discount of around 6.5% to Friday’s close. The banks handling the sales were both joint lead managers on Rivian’s IPO last year when they sold the same stock at $78.

Mark-to-market revaluations of holdings in Rivian were a big factor behind both Ford and Amazon disappointing with their quarterly earnings recently.

3. Stocks set for another tough day. Food, real estate earnings eyed

U.S. stock market is set for another round of heavy selling at the opening, with the news of the Rivian block sales an uncomfortable reminder of how radically investors are reappraising the outlook for growth, interest rates, and consequently, stock valuations.

By 6:15 AM ET, Dow Jones futures were down 435 points, or 1.9%, their lowest since late February. The S&P 500 futures and Nasdaq 100 futures contracts were down at their lowest in over a year, losing 1.6% and 2.0%, respectively.

Earnings season is starting to wind down, but a number of important updates are still due later. Coty (NYSE:COTY) lifted its outlook after a strong first quarter. Tyson Foods (NYSE:TSN) will have something to say about the outlook for meat prices, while Duke Energy (NYSE:DUK) and Exelon (NASDAQ:EXC) may offer more color on the rising risk of electricity blackouts this summer. Mall landlord Simon Property (NYSE:SPG) and International Flavors and Fragrances (NYSE:IFF) report after the close.

4. Victory Day without victory

Russian President Vladimir Putin held his usual Victory Day parade to commemorate the end of the Second World War, but without being able to proclaim any new victories in Ukraine.

Putin’s eagerly anticipated speech was more notable for what it lacked, rather than what it contained – there was no mention of the full mobilization that defense chiefs have reportedly pressed for, nor of any new strategic goals, nor of the nuclear threats against the West which are now the daily staple of Russian state television.

Over the weekend, Ukrainian forces had reportedly hit another Russian warship, the frigate Admiral Makarov with anti-ship missiles. Hundreds of Ukrainian soldiers, meanwhile, continue to defend the Azovstal steel mill, their last redoubt in the besieged city of Mariupol.

Elsewhere, the EU’s top diplomat Josep Borrell suggested seizing Russia’s frozen foreign exchange reserves to help pay for the reconstruction of Ukraine.

5. Oil falls on Chinese trade data as Hungary stalls on EU embargo

Efforts to tie up a European embargo on Russian oil imports continue to be impeded by Hungary, however, which is still pressing for a five-year grace period. That’s emboldening others such as Slovakia and Bulgaria to press for carve-outs of their own.

Russian Oil Minister Alexander Novak was quoted by Russian newswires earlier as saying that he expects the country’s oil output to rise this month after sanctions badly disrupted shipments in April.

U.S. crude futures were down 2.2% by 6:25 AM ET at $107.33 a barrel, amid a broad risk-off movement in global markets prompted by the Chinese trade data. Brent futures were down 2.1% at $110.10 a barrel.

Dollar 20-Year High, Rivian Block Sales, Chinese Trade - What's Moving Markets

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
Stan Smith
Stan Smith May 09, 2022 9:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Goldman: This is the top of book depth of S&P futures divided by 1mo ATM vol. It is flashing red. The set up for an equity market crash is as high as I have seen it."
Thanos theBear
Thanos theBear May 09, 2022 7:16AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
usd only thing moonin
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email