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The World
Major U.S. stock indexes registered a comeback for the ages, storming to a higher close after the Dow industrials were down more than 1,100 points at midday. Just after noon, the Dow was off 3.25% and the Nasdaq Composite Index had dropped 4.9%. Then, in the blink of an eye, bargain-seeking investors stepped in, snapping up shares of technology favorites such as Tesla and Nvidia. By the end of the day, the Dow Jones had gained 99.13 points. The Dow had never before closed positive after being down at least 1,000 points. Nasdaq advanced 0.6%. Investors and analysts said the turnaround was driven by a handful of factors, first and foremost the carnage of this year opening the way for some rare opportunities to purchase favored shares at lower prices. Others said the rebound appeared driven by hedge funds and algorithmic traders, which often buy and sell shares when preset criteria are met. (Wall Street Journal)
Bitcoin climbed into positive territory after falling below $33,000 to a new low. The No. 1 cryptocurrency and ether are sitting about 45% and 49% from their respective all-time highs. The steep declines have been correlated to the selling seen in higher risk assets like technology stocks as investors prepare for higher interest rates and tighter monetary policy from the Fed. (CNBC)
Defense Secretary Lloyd J. Austin III put 8,500 American troops on “high alert” for possible deployment to Eastern Europe, as NATO and the U.S. braced for a possible Russian invasion of Ukraine. Most of the 8,500 troops would take part in a NATO response force that might soon be activated. The remaining personnel would be part of a specific U.S. response to the deepening crisis, most likely to provide assurance to American allies in Eastern Europe who are fearful that Russia’s plans for Ukraine could extend to the Baltics and other countries in NATO’s so-called eastern flank. (New York Times)
NATO said it was putting forces on standby and reinforcing eastern Europe with more ships and fighter jets — while Britain joined the U.S. in ordering families of diplomats out of Ukraine — in what Russia denounced as Western "hysteria" in response to its build-up of troops on the Ukraine border. (Reuters)
UK PM Boris Johnson said that Russia has massed enough troops close to Ukraine for a “lightning war” in which it would try to seize Kyiv. (Financial Times)
Hacktivists in Belarus said they had infected the network of the country’s state-run railroad system with ransomware and would provide the decryption key only if Belarus President Alexander Lukashenko stopped aiding Russian troops ahead of a possible invasion of Ukraine. If confirmed, the attack would be one of the first times ransomware has been used this way. (Ars Technica)
Demand outweighs supply for China’s record number of job-seeking graduates. The number of jobs available per applicant among fresh university graduates in China fell to the lowest point since the early months of the pandemic in 4Q21. (South China Morning Post)
Italian lawmakers cast a deluge of blank votes in the first round of the presidential election, in a delaying action amid intense backroom negotiations to resolve an impasse over whom to anoint as head of state. Out of the total 954 ballots cast, 672 had no name written on them — reflecting an agreement among members of prime minister Mario Draghi’s fragile national unity government to avoid an outcome that could upset Italy’s delicate political equilibrium. (Financial Times)
A New York judge ruled that the state’s mask mandate for public spaces is unconstitutional, while Maui changed its definition of ‘fully vaccinated’ to include the booster shot. (Washington Post)
IL Gov. J. B. Pritzker vetoed legislation to pay COVID-19 sick leave to all school employees, says only fully vaccinated should be compensated. (Chicago Tribune)
Economy
Mohamed El-Erian: “The Fed needs immediately to stop its asset-purchase program, guide markets towards expecting three and possibly more interest rises this year and bring forward to March the announcement of plans to reduce its balance sheet. It also needs to explain how it has managed to get its inflation call so wrong and why it is so late in reacting properly. Without that, it will struggle to regain the policy narrative and restore its credibility.” (Financial Times)
South Korea's economic growth hit an 11-year high last year on the back of strong exports and corporate investments, rebounding from the previous year's negative growth. Private spending remains weak in Asia's 4th-largest economy as COVID curbs bite. (Nikkei Asia Review)
A record number of US IPOs last year allowed founders and early investors to sell shares before the end of a traditional 180-day waiting period. In 2021, 25% of IPOs — 91 in all — included early lock-up period releases. The data excluded stock up-listings and cross listings from other exchanges. These totals were the highest for the period that Renaissance analyzed, which dates to 2011. In 2020, 9% — or 17 companies — had early lock-up periods, according to the company. “It has just skyrocketed,” said Avery Spear, a data analyst at Renaissance. (Financial Times)
AR/VR startups raised nearly $1.9B in 4Q21, more than any quarter ever, making 2021 the second-best year for AR/VR funding at nearly $3.9B raised. (Crunchbase)
With investors paying increased attention to ESG issues, the message is clear: Companies that want to stand out in the capital markets can’t afford subpar ESG results. Here are four reasons why private equity firms of all sizes are taking ESG seriously—and why companies across industries should consider initiating or improving their approach: 1) How a company handles its ESG responsibilities reflects on its ability to protect value and manage risk; 2) Better ESG performance enables value creation; 3) ESG can be a critical market differentiator for Millennials and Gen-Z; 4) ESG is about future-proofing a business. (Forbes)
Technology
Burnt out Amazon employees are embracing the Great Resignation: Long hours and an unusual pay structure are credited for attrition challenges. (Bloomberg)
The District of Columbia and three states sued Google, claiming that the tech giant deceived consumers to gain access to their location data. In separate lawsuits, the attorneys general of the district, Texas, Washington and Indiana claimed that Google misled users of Android phones and of tools like Google Maps and its search engine by continuing to track location information of users who had changed privacy settings to prevent the data collection. (New York Times)
Google is facing a fresh complaint from Germany’s largest publishers and advertisers, which are demanding that the EU intervene over the search giant’s plan to stop the use of third-party cookies. Axel Springer is among the hundreds of publishers, advertisers and media groups that have argued to the bloc’s competition chief, Margrethe Vestager, that Google is breaking EU law with its move to phase out third-party cookies from its Chrome browser by next year. The decision blocks advertisers, publishers and intermediaries from analyzing users’ preferences while they browse online content — a critical blow to how the industry generates revenues. (Financial Times)
Sony Music Entertainment announced it has fully acquired Bob Dylan’s entire back catalog of recorded music, as well as the rights to multiple future new releases, in a major expansion of SME’s six-decade relationship with the artist. Sources tell Variety that the deal was worth between $150 million and $200 million. (Variety)
Data centers used ~17% of Ireland's generated power in 2021, expected to grow to 27% by 2030, putting the country's ambitious climate goals into question. Meanwhile, virtual worlds, or even just immersive experiences in the metaverse, will need far more network capacity than is currently available in homes around the world (CNN, Financial Times)
Why gaming is the new Big Tech battleground: The huge size of today’s gaming audience, which already dwarfs other forms of mass-market entertainment, is playing to the strengths of companies that can build and manage giant online businesses to spread their costs, according to Bing Gordon, a longtime video game executive and venture capitalist. “The new critical mass is bigger than ever,” he says. Comparing pressures building up in the games industry to the streaming video wars that are reshaping the TV and movie business, he adds: “Someone’s going to create a games service with hundreds of millions of subscribers.” (Financial Times)
Smart Links
Meta has built an AI supercomputer it says will be world’s fastest by end of 2022. (The Verge)
IBM posts best sales growth in 10 years on cloud demand. (Bloomberg)
New York’s beleaguered hotel industry braces for even more hotels. (Wall Street Journal)
Twin Cities home sales at a 20-year high, listings at a 20-year low. (Minneapolis Star Tribune)
Ford shuts off orders for new $20,000 Maverick pickup. (Wall Street Journal)
Webb telescope reaches its final destination far from Earth. (Nature)