By Geoffrey Smith
Investing.com -- President Joe Biden talks tough on China and Iran; Hyundai and Kia end talks with Apple (NASDAQ:AAPL) over self-driving cars; crypto surges thanks to some pumping by Elon Musk, earnings from Hasbro (NASDAQ:HAS) and Loews (NYSE:L) are due, and oil hits $60 a barrel. Here's what you need to know in financial markets on Monday, February 8th.
1. Biden sees “extreme competition” with China
The U.S. is ready for “extreme competition” with China over the next four years, President Joe Biden said at the weekend.
In an interview with CBS, Biden appeared to suggest that U.S. policy toward China will be less confrontational than under his predecessor but will not differ significantly in its aims.
“I’m not going to do it the way Trump did. We are going to focus on the international rules of the road,” Biden told CBS.
Elsewhere in the interview, Biden said he wouldn’t lift sanctions on Iran to bring it back to the negotiating table with regard to its nuclear fuel enrichment. He said Iran would have to stop enriching first.
2. Hyundai, Kia tumble after saying Apple talks are off
Shares in Korean carmakers Hyundai and KIA both fell sharply in Seoul after the former said it’s no longer in talks with Apple to develop autonomous electric cars.
Hyundai had confirmed early-stage talks with the iPhone maker only a month ago. Hyundai (OTC:HYMLY) stock fell 6.2% in response, while its shares in its affiliate KIA (KS:000270), which had also been tipped as a likely partner, fell 15%. In all, the movements wiped $8.6 billion off the two companies’ valuations.
Elsewhere in the auto sector, Daimler (OTC:DDAIF) Chief Executive Ola Kallenius said his company would need until the end of the decade for its electric vehicles to be as profitable as its traditional gas-burning ones.
3. Stocks set for run at fresh highs; Hasbro, Loews, Global Payments (NYSE:GPN) due to report
U.S. stock markets are set for a run at new record highs on Monday, against a backdrop of an improving public health picture and the steady progress of President Biden’s $1.9 stimulus package.
New infections of Covid-19 fell to under 100,000 for the first time in nearly three months at the weekend, while the strain on hospital capacity also eased further, with only 81,000 admissions, its lowest since late November. On the downside, AstraZeneca (NASDAQ:AZN) reported its vaccine had limited efficacy against the new variant of the virus first identified in South Africa.
By 6:30 AM ET (1130 GMT), Dow Jones futures were up 123 points or 0.4%, while S&P 500 futures were up by a fraction less and NASDAQ Futures up a touch more.
Earnings season is starting to taper off, but Global Payments, Hasbro and Loews all report before the open while Simon Property (NYSE:SPG) reports after the close.
4. Crypto surges again as Musk cheerleads
Cryptocurrencies continued their broad rise higher, amid a sustained feverish mood on social media stoked not least by Elon Musk.
DogeCoin, a relatively new unit championed by Musk in a series of tweets, many of them seemingly joking, rose to a high of 8.4 cents overnight, taking its gains over the last two weeks to some 150%.
Bitcoin, meanwhile, again topped $40,000 briefly, while Ethereum rose as high as $1,735.60 before correcting slightly. As always, momentum rather than any change in fundamentals appeared to be behind the moves.
5. Oil at $60 as Iran export fears moderate
Crude oil prices hit $60 a barrel for the first time in a year, as part of a multi-faceted rally in risk assets across global markets. Prices were supported by Biden’s tough-sounding words on Iran, which took the edge off fears for a quick resumption and ramp-up of Iranian oil exports.
Biden’s comments come against the backdrop of a tightening market as demand slowly recovers while major suppliers continue to withhold millions of barrels a day of production from the market, an effort that is whittling down global crude stocks.
By 6:45 AM ET, Brent crude futures were up 0.9% at $60.07 a barrel while U.S. crude futures were up 1.2% at $57.52 a barrel.