$BABA Broke Down

Tale of the Tape

Good afternoon, folks. The market was quiet as we wrapped up another week. 🎁 😉

The major indices all closed +/- 0.5% while the Russell 2000 was the only major index to finish negative. 

Real estate, utilities and tech were today’s strongest sectors. Energy sucked and closed negative.

Tesla charged up 2.16% and closed at its second highest price ever. ⚡

Alibaba broke down 13.73% after Chinese officials filed an antitrust lawsuit against Alibaba and Ant Group. See more on this below. 

The UK and EU finally settled on a trade agreement. The deal is done! 🇬🇧

Here are the closing prints: 

S&P 5003,703+0.35%
Russell 20002,003-0.16%
Dow Jones30,199+0.23%

$BABA Billionaire Can’t Catch A Break

The Chinese government is relentless. Today it filed an antitrust suit against Jack Ma’s Alibaba and Ant Group. Here’s the official filling, for those of you who can read Mandarin.

This move comes less than two months after the government cancelled Ant Group’s IPO following Ma’s controversial commentary.

$BABA broke down 13% and had its worst day ever. 😬

Here’s the daily chart:

Brexit Trade Deal 🇬🇧

The UK has finally reached a Post-Brexit trade agreement with the EU. After many (many, many) negotiations, the UK has an official trade deal with the separate EU bloc. 🥳

The fair trade deal permits tariff and quota-free trade for goods after December 31, excluding the service industry. 

UK officials couldn’t be happier. Prime Minister Boris Johnson tweeted: 

In Boris’s words, the deal is done!

Gaming Crushed 2020 💪

The video game industry dominated entertainment in 2020. 

Gaming revenue registered $180B this year, up 20% YoY. Compare that to the $100B movie industry and $75B from major league sports in 2019. 

Nintendo, Sony, and Microsoft got all the attention this year— Walmart and Amazon can’t keep the PS5 or Xbox in stock, and Nintendo Switch sales grew 80 percent from April to September. 

Will this momentum carry into 2021? Experts say it depends on the Covid vaccine’s efficacy, but only time will tell…

The NBA Is 0-1 Against Strip Clubs

In the bubble at Walt Disney World last season, the NBA managed to avoid a single Covid case for over three months. This season, they lasted . . . one day.

Yesterday, the league cancelled the game between the Houston Rockets and Oklahoma City Thunder after more than three Rockets tested positive (or inconclusive) prior to tip-off.

The outbreak comes after Harden was spotted at what appears to be an adult establishment on Monday (although he denies allegations), an incident for which he was fined $50k.

Harden should know better — after all, his performance is statistically tied to strip clubs. 😬

Bucket Shops

Last week, Jamie Catherwood called Robinhood an improved bucket shop

Here’s a classic photo of a bucket shop from the early 1900s:

A lot can change in a century, but market participants don’t. Denise Shull, author of Market Mind Games, said seeing old photos helps to remember we are always trading other humans’ perceptions.

244 Years Ago, Tomorrow 🇺🇸

To the naked eye, General George Washington’s choice to move 2,400 Continental soldiers across a frigid river in a winter storm seemed unthinkable.

But Washington’s move was strategically developed after months of intense battling.

George Washington’s crossing of the Delaware River on December 25, 1776 permitted his army to strike the Hessians at Trenton the next morning. As luck would have it, many regiments didn’t arrive at the river until after dark. A winter storm even ambushed the soldiers on the riverbank, significantly slowing their crossing. 

The exhausted and freezing Continental Army nonetheless gathered at the Jersey shore. Washington then led his army to Trenton. It was at Trenton that he secured the first major military victory for the Continental Army. 🇺🇸

Here’s George Washington’s Mount Vernon Library with the full story.

Links That Don’t Suck

*💹 IBD is offering 12 days of discounts on MarketSmith, SwingTrader and more! What’s today’s deal? Go here to find out…

💡 JPMorgan’s Jamie Dimon and His Brush With Death

🚗 RV Owners Take to the Road With ‘Covid Campers’

💪 Lionel Messi to Gift Budweiser to Every Goalkeeper He Scored Against

🏰 Once Asking $100 Million, Michael Jackson’s Neverland Ranch Sells to Billionaire Ron Burkle for $22 Million

🏠 MLZD and Sollberger Bögli Architects Complete Angular Football Stadium in Lausanne

👟 From Nike to Balenciaga, the Seven Strangest Sneakers of 2020