7 Key Charts to Assess Global Risk Markets This Week

Bitcoin breaks records as BlackRock’s ETF surges, Trump’s political future takes shape. Each week, the Syz investment team takes you through the last seven days in seven charts.

1. Bitcoin’s Market Capitalization Surpasses Silver’s

What a week for bitcoin, flying from record to record with a mid-week high of $93,000. The largest cryptocurrency is now the world's 8th largest asset in terms of market capitalisation, surpassing silver at $1.74 trillion.

Top Assets by Market Cap

Source : www.companiesmarketcap.com

2. Blackrock's Bitcoin ETF Is a Phenomenal Success

Back in 2017, Blackrock (NYSE:BLK) Chairman Larry Fink was highly sceptical of cryptocurrencies, at one point calling bitcoin an “index of money laundering”. He has since categorically changed his mind, declaring in 2023 that Bitcoin could revolutionize finance. In the 1st quarter of this year, Blackrock obtained SEC approval in the USA to launch their first ETF (exchange-traded fund) on bitcoin. This ETF is breaking all records in terms of fundraising, reaching $40 billion in assets under management in record time.

This is the most successful ETF of all time in terms of the speed with which it has reached this level of assets under management. The chart below compares the evolution of assets under the management of Blackrock's iShares Bitcoin ETF (IBIT in orange) with other highly successful ETFs (Vanguard S&P 500 ETF (NYSE:VOO), iShares Core MSCI EAFE ETF (NYSE:IEFA) and iShares Core MSCI Emerging Markets ETF (NYSE:IEMG)).

IBIT vs VOO vs IEMG ETF Performance

Source: Bloomberg Intelligence

3. Pharmaceutical Companies Commercialising and Developing Vaccines Plunge in the Stock Market After the Nomination of Robert Kennedy Jr to the Department of Health

Donald Trump announced on 14 November that he was appointing Robert F. Kennedy Jr, a former vaccine-sceptic lawyer known for propagating conspiracy theories, as Secretary of Health.

Over the past 4 weeks, some pharmaceutical stocks have plummeted as markets began to anticipate such a nomination. The official announcement of his appointment only accelerated the fall. Over one month, Moderna (NASDAQ:MRNA) fell by -30.6%, Novavax (NASDAQ:NVAX) by -42.7% and BioNTech (NASDAQ:BNTX) by -11.9%, as investors feared a radical change in US healthcare policy.

RFK Jr, who has questioned traditional medical practices and pledged to streamline the FDA, says he will refocus health agencies on nutrition and the fight against chronic diseases.

President Trump, meanwhile, has declared, “For too long, Americans have been crushed by the industrial food complex and drug companies.”

Change in Pharma Stock Companies Prices

Source: @Breaking911 NBC, Mario Nawfal

4. American Exceptionalism

The United States now represents 74% of the global MSCI market capitalization, marking a new historical record.

MSCI World Market Cap

Source: SocGen

5. Has the US Federal Reserve Cut Its Key Rates Too Soon?

The U.S. inflation report for October aligned with consensus expectations. The 12-month CPI accelerated to 2.6% in October, up from 2.4% in September. Core CPI (excluding energy and food) remained steady at 3.3%.

The housing price index rose by +4.9% year-on-year, while transportation prices stabilized at +8.2%. Wage and rent inflation remain stubbornly high, keeping service price increases difficult to slow.

Since the 50-basis-point rate cut in September, the Federal Reserve now faces a unique set of challenges:

1. China is stimulating its economy through fiscal and monetary measures.
2. The new U.S. administration is pushing for economic growth through tax cuts and infrastructure spending, leading to increased debt and inflationary pressures.
3. Additional tariffs and reduced immigration are also expected to fuel inflation further.

What could this mean for long-term bond yields in the coming months?

US CPI YoY

Source: Bloomberg

6. Many Layoffs to Come in the Public Sector?

President-elect Donald Trump announced on12 November , his plan to appoint Elon Musk, CEO of Tesla (NASDAQ:TSLA), SpaceX, and X, alongside Republican businessman Vivek Ramaswamy, to head a newly created Ministry of Government Efficiency. “Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies,” he declared.

The U.S. government currently employs approximately 23,470,000 workers following a hiring spree before the presidential election.

If Musk applied the same 80% layoff rate as he did at Twitter/X, 18,776,000 public sector employees would lose their jobs…. - a figure that is, of course, unrealistic.

Total US Government Workers

7. The Size of the African Continent in Perspective

The size and diversity of Africa is amazing! It's essential to recognize that the continent encompasses a vast array of economies and social landscapes, from the most industrialized economies like South Africa (GDP per capita of around $7,000) to middle-income countries like Morocco and Egypt. On the other side of the spectrum, nations like Burundi (with one of the lowest per capita GDPs, around $250) highlight the profound economic disparities.

Size of African Continent

Source: Commodity Trading Club

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