Stocks try to steady after sell-off

Morning Note

What did I miss? Markets in Europe steadied but failed to really bounce after a brutal sell-off on Wednesday saw all the major indices deeply in the red and trading at levels not seen for some time.

The instigation of second national lockdowns in Germany and France rattled markets.

Election nerves may also be present, particularly as the path to a stimulus package in the US will not become clear until after the results are known.

We know that governments are supportive of business, but we also know it was a long slog out of lockdown last time and won’t be easy this time. Markets had become a little complacent about the recovery and secondary lockdowns tell a different story – it will be rocky and uneven.

The S&P 500 tumbled 3.5% and closed below 3,300 with similar losses on the Dow Jones and Nasdaq. Vix futures rose to levels not seen since the sell-off at the start of September.

Futures point to a higher open on Wall Street. US GDP figures later will give the first look at the Q3 bounce back. The dollar rose back to the top of the recent range with the euro coming under pressure from lockdowns measures in the bloc’s two largest economies.

GBPUSD was steady at 1.30 but won’t move until there is a significant Brexit headline.

Lockdowns are not good for oil sentiment. Prices slumped on the lockdown announcements but also felt the pinch from a rise in US crude stocks. EIA figures showed a 4.3m barrel build in US crude inventories.

As we have been warning, the threat of falling demand leading to inventories flipping from draws to builds has been present and we can expect this trend to weigh on prices.

Nevertheless, Shell raised its dividend after reporting better-than-expect earnings for its third quarter. Management hiked the divi by 4% to 16.65 cents – having made an historic cut to the dividend during the peak of the pandemic earlier in the year. Shares rose over 3% in early trade.

Lloyds shares also rose after it swung back into profit and set aside less for impairments than feared – chatter around dividends returning will get louder, particularly as these results come in the wake of some pretty upbeat notices from the larger banks.

The risk is that the fiscal support runs out and new lockdowns and depressed demand due to the chronic impact of the pandemic on consumer and business sentiment means impairments are going to rise later in 2021.

It’s a big day for corporate earnings in the US and the focus will undoubtedly fall on the FAANGs with Apple (AAPL), Amazon (AMZN), Alphabet (GOOGL) and Facebook (FB) all set to report quarterly earnings figures later.

Earnings come amid heightened scrutiny on big tech as the US Department of Justice opened an antitrust case against Google’s parent company, Alphabet, whilst executives from social media giants faced a Senate hearing yesterday on reforming so-called Section 230 rules that give tech platforms immunity from prosecution over user-generated content. Shares in all fell sharply on Wednesday amid the market turmoil.

With lockdowns in focus, today’s European Central Bank meeting will be of particular importance for European markets. Many market participants are increasingly betting on the ECB carrying out further easing in a bid to boost faltering economic growth and stagnant prices.

The Eurozone slid into its second straight month of deflation in September and with further lockdowns being imposed across the bloc, the risks to the economic outlook have clearly deteriorated since the last meeting and the assumptions for growth contained in the ECB’s September look out of step with reality. Weakness in Friday’s PMIs highlights the concern among businesses, particularly in services.

The threat of a double-dip recession is real – Christine Lagarde recently commented that the resurgence of the virus is a clear risk to the economy – and that was long before the imposition of national lockdowns in Germany and France.

Given the murkier outlook and dreadful inflation backdrop, it seems all but certain the ECB will increase its bond-buying programme by another €500bn by December – albeit it may choose to increase PSPP rather than PEPP – for the markets these acronyms won’t matter too much – it’s the size and duration of the liquidity injection that matters, not how it is presented.

Lagarde may drop some hints in the press conference to increasing PSPP/PEPP envelopes in December but will not over-commit. Moreover, with progress on delivering on the fiscal side slow, the ECB will feel obligated to step up.

To get a flavour of the mood in the ECB, the usually hawkish Austrian central bank head Robert Holzmann said recently: “More durable, extensive or strict containment measures will likely require more monetary and fiscal accommodation in the short run.” Fundamentally it will be more of the same from the ECB with it stressing it is ready to do more and the momentum is with the doves to ease more.

Ahead of the election next Tuesday, Biden leads by 7.5pts nationally, and by 3.6pts in the battlegrounds.

HSBC and BP shares rally, European equities struggle after capitulation

Morning Note

HSBC dividend hopes rekindled: Shares rallied 6% on upbeat noises from management that it intends to start paying dividends again despite profits falling by a third as lower interest rates bit.

In its Q3 statement today the bank said the board will consider whether to pay a “conservative” dividend for 2020.

It will depend on regulators – we noted yesterday that shares in UK banks were slow to respond to reports the Bank of England is talking to commercial banks about restarting divis. The prospect of dividends coming back will interest income investors again and with returns cut all over the place, anything that offers yield will be snapped up.

The bank reported profit before tax was down 36% to $3.1bn, mainly from lower revenue, which declined 11% to $11.9bn. Asia was the sole source of positive income as it reported profit before tax of $3.2bn in the third quarter, despite interest rate headwinds.

It underlines the fact HSBC’s exposure and reliance on Greater China has been a positive this year in the wake of the pandemic and the economic recovery in that region being swifter than in Europe/US.

Cuts to interest rates by central banks left net interest margin at 1.20%, which was down 36 basis points from Q3 2019. Expected credit losses and other credit impairment charges were down $100m to $785m thanks to a steadier outlook for the economy.

Loan losses for the full year are seen around the lower end of the $8bn-$13bn range. Whilst banks are now setting aside less for bad loans than they did at the height of the pandemic in the spring, it’s unclear whether fiscal support is only kicking this particular can down the road.

Management warned specifically about ongoing US-China trade tensions and the uncertainty over the UK withdrawal from the EU. They also warned that the low-interest rate environment continues to put pressure on net interest income and will exert further headwinds through the fourth quarter before they are seen stabilising in 2021.

Are things starting to stabilise at BP? Shares rallied 2% as the company swung back to a profit in the third quarter. Underlying replacement cost profit for the quarter rose to $86m, compared with a loss of $6.7 billion for the second quarter of 2020 and down 96% from $2.3 billion profit for the third quarter of 2019.

BP said the result benefitted from the absence of significant exploration write-offs and recovering oil and gas prices and demand. This was partly offset by a significantly lower oil trading result, the company said. The dividend was maintained at 5.25 cents.

Fundamentally it’s just really tough to make money with oil prices at these levels – BP’s breakeven is at $42 and Brent today trades at $41 with a negative outlook as demand remains depressed and global inventories build. Whilst oil prices have certainly stabilised since the worst period of volatility in the spring, they have stabilised at materially lower levels than the industry would like.

Weaker oil prices combined with the catalyst of the pandemic is accelerating the green drive away from reliance on hydrocarbons. The commitment to renewables will require further investment and this may require further divestments.

Management says they have agreed or completed transactions for almost half the $25bn target by 2025. Net debt at quarter-end was $40.4 billion, down $0.5 billion, with the company saying it is on course to reach its $35bn target. Gearing at 33% was above last year and higher than where Bernard Looney would really like it to be.

Stocks in Europe struggled this morning after US markets were down heavily in the previous session and there was a weak handover from Asian equities. Yesterday’s capitulation across equity markets may require a bit more of a washout before the bulls are happy to come in again – they may even decide to wait for the US election to be over first, although after an hour of trading on Tuesday we have seen the bourses steadily come back to the flatline.

Stimulus seems like a bust before the election after Pelosi and Mnuchin failed to reach agreement on a call on Monday and Mitch McConnell adjourned the Senate until Nov 9th.

Pre-election volatility would be expected but this is occurring just as we are seeing the average number of new daily cases of coronavirus in the US hitting a record high, with former FDA boss Dr Scott Gottlieb warning of an exponential spread of the virus. Strict lockdowns across Europe and the problem of getting fiscal support where it needs threatens to create a double-dip recession.

Election jitters, no progress on a stimulus package and surging case numbers culminated in an equity market capitulation yesterday.

The S&P 500 declined almost 2% and under the 50-day simple moving average at 3,408, though it rallied off the lows at 3,364 in the last hour to finish at 3,400. Among the volume leaders, Snap declined 4.4%, Apple was flat ahead of Thursday’s earnings and American Airlines dropped over 6% as travel stocks were among the worst performers. Cruise liners sank by 8-9%.

The situation in Europe was no better, though the FTSE 100 failed to put in a new low. The DAX capitulated with a decline of 3.7% sparked by SAP’s pessimistic outlook and the German market is trading at levels not seen since June.

Earnings today to watch out for 

27Oct   Microsoft Corp.   Q1 2021 Earnings  
27Oct   Pfizer Inc.   Q3 2020 Earnings  
27Oct   Merck Co.   Q3 2020 Earnings  
27Oct   Eli Lilly and Co.   Q3 2020 Earnings  
27Oct   3M Co.   Q3 2020 Earnings  
27Oct   AMD (Advanced Micro Devices) Inc.   Q3 2020 Earnings  
27Oct   Caterpillar Inc.   Q3 2020 Earnings  

Election Watch

Biden lead cut to 7.8pts nationally but holds at 4.1pts in battlegrounds. Trump trailed Clinton by 2.8pts in the key swing states at this stage in 2016.

Elsewhere, whilst equity markets are volatile, bonds haven’t moved much with US 10-year Treasury yields at 0.80% and 10-year TIPS at –0.91%. With little movement there, gold is finding itself hugging its 21-day SMA and stuck between its 50-day and 100-day moving averages.

FX markets remain relatively calm. GBPUSD was steady at 1.30 as Brexit talks continue in London and EURUSD was holding around 1.18 ahead of the ECB meeting this Thursday. US durable goods orders on tap today expected at +0.5%, with core reading seen at +0.3%.

Gold movement on 27.10.2020

How to invest in shares

Investing in shares is a way to generate income, save for the future and speculate on individual companies, sectors and the entire stock market. Of course, the value of your investments can go down as well as up. In this short 7-step guide we will explain the basics of investing.

What is an investment?

Investing is a way to put money to work – in other words instead of parking excess cash you have in the bank and getting a fractional amount of interest, an investment is expected – but not guaranteed – to deliver a higher return. Investing is inherently riskier than leaving money in the bank. There are lots of ways to invest – from property to fine art – but arguably the most common and simplest way to invest is in the stock market. 

How do stock markets work?

Stock markets are simply a marketplace for shares of individual companies. Buyers and sellers meet to exchange shares. In the past this was all done in person on trading floors, but increasingly the vast majority of buying and selling shares is carried out online via a network of regulated exchanges like the NYSE, Nasdaq and London Stock Exchange among others 

Companies issue shares – each one a claim on a tiny portion of the business – in order to raise cash to grow, or sometimes for founders to exit the companyThe process of listing shares on an exchange is usually called an Initial Public Offering, or IPO. Usually individual investors can only purchase shares once the stock has begun trading. 

Sometimes companies already trading on the stock market will issue fresh shares to raise more money, which can reduce the price of the shares already on the market. Sometimes they carry out buybacks, when the company buys up existing shares to reduce the number of shares, which can increase the price of the remaining shares. 

At all times, shares trading on public exchanges are constantly changing hands as private investors, sovereign wealth funds, hedge funds, pension funds, mutual funds and private equity firms buy and sell stocks based on the most up-to-date information they possess. This creates a market and gives us a share price, which is usually quoted as the midpoint between the bid price – the highest price a buyer will pay – and ask price – the lowest a seller will accept. 

What is a share?

A share is simply a right of ownership of a fraction of the company. It entitles the owner to a financial claim on the business and usually entails voting rights which are exercised from time to time, for example if a company is subject to a takeover. For example, there are about 70bn shares of Lloyds. If a large shareholder owned 7bn shares, they would own 10% of Lloyds and would have considerable sway over the company.  

How much income can investing generate? 

The first thing to bear in mind is that investing is not a one-way street – the value of your investment can go down as well as up. 

But the idea of investing is to grow the value of your assets over time. There are two ways you can generate returns. The first is capital appreciation – the value of the shares rising over time to be worth more than they cost you. The other is through dividends, which is when a company returns some cash to shareholders from the profits they make. 

Dividends are like interest payments on a savings account, only they can be more volatile since these depend on each company deciding to pay a dividend. For example, in 2020 the coronavirus pandemic saw large numbers of companies suspend dividends in order to protect their balance sheets. Nevertheless, the FTSE 100 was able to offer investors a dividend yield of around 4%, which is considerably more than the 0.1% Bank of England base rate. 

How can I invest in shares?

The simplest way to invest in shares is to open a share dealing account. It’s a relatively straightforward process and within minutes you could be building your very own stock portfolio 

You can pick individual shares or choose to invest in a broader collection of shares that give you exposure to different areas of the economy.

Example: UK stocks

For example, you may like to invest UK banks, so you could split your portfolio across Barclays, NatWest, HSBC, Lloyds and Standard Chartered. Or you could decide you would like exposure to the UK property market, because for instance you think house prices will rise and the market is fundamentally sound. In this case, you may only invest in Lloyds and NatWest but also purchase shares in housebuilders like Barratt Developments and Persimmon, as well as estate agents like Foxtons and Countrywide. 

How do I decide which stocks to buy?

There are thousands of stocks to invest in, so choosing which shares to buy can seem daunting. There are lots of different approaches to investing, from value investing to growth investing. Growth stocks are companies with the potential to outperform the broader stock market because they are expected to grow earnings at a much faster rate than other stocks. Value stocks are considered those trading below what they are ‘worth’.

Week Ahead: Brexit crunch time, US earnings season kicks off

Week Ahead

Welcome to your guide to the week ahead in the markets.

European Council Summit 

It’s make or break time for Brexit. EU heads of state hold their next summit this week, starting on Thursday. The meeting also marks UK Prime Minister Boris Johnson’s last chance to agree a Brexit deal, but the UK’s latest proposals have not met a warm reception. If nothing is forthcoming, the recently passed Benn Act obligates the PM to request an extension by Saturday at the latest. Boris seems to have some plan to circumnavigate the legislation, although Downing Street is unsurprisingly quiet on the details. 

Earnings Season 

The third quarter earnings season on Wall Street gets underway this week, with S&P 500 companies seen posting a year-on-year earnings per share decline for the third straight quarter. 

As usual banks get the season off to a start. Financials posted decent gains in Q3, boosted by a strong +4.5% gain in September.  

JP Morgan (Tuesday) is expected to deliver EPS of $2.45. In Q2 the company reported net income up 16% to $9.65 billion from last year’s $8.32 billion. EPS beat the $2.50 expected at $2.82, rising from $2.29 in the same quarter a year before. Net interest income is the concern in early September at the Barclays conference boss Jamie Dimon said he sees full-year 2019 net interest income down $500M from the last guidance.  

Citigroup (Tuesdayposted good numbers in Q2 as well with EPS of $1.95 topping the $1.80 expected, although trading revenues were down. For Q3 the Street expects EPS growth of c13% at $1.97 a share. Revenues are expected to rise a little less than 1% to $18.54bn. 

Wells Fargo (Tuesday) beat in Q2 but lower net interest income and comments about higher expenses acted as a drag. EPS for Q3 is seen as at $1.20, up 5.3% year-on-year, on revenues seen –5% at $20.85bn. In September the bank’s CFO lowered the net interest income for the third time in five months, with the company now seeing this key profit metric down 6% this year compared with 2018. Bulls will be clinging to anything positive on net interest income. 

Netflix (Wednesday) has had a tough comedown and Wall Street has turned cold on the stock as the risk of a competitive spiral from the rise of rival streaming services threatens to derail the company’s remarkable growth. Investors have shown concern about subscriber growth rates that have started to falter. In Q2 global net adds of 2.7m massively missed expectations for 5m.  

Eco data 

On the high frequency economic data front we are looking at the RBA meeting minutes and Chinese inflation figures early on Tuesday, with the German ZEW economic sentiment survey likely to be key for the European session. 

Wednesday sees the CPI inflation numbers for the UK and Canada, with US retail sales also in focus. 

Thursday, we have the Australian unemployment data, which is a key factor in the RBA’s thinking on monetary policy, before the Phill Fed manufacturing index ahead of the US session. 

On Friday the focus will be the data out of China, with GDP, industrial production and fixed asset investment figures due. 

Tentatively scheduled for Friday is the US Treasury Currency Report, which outlines countries that the US deems currency manipulators.

Corporate Diary

Earnings season is upon us again, here are the notable releases this week.

October 15thJPMorgan Chase & Co
October 15thJohnson & Johnson
October 15thWells Fargo & Co
October 15thCitigroup
October 16thIBM
October 16thNetflix
October 17thMorgan Stanley
October 17thPhilip Morgan
October 18thAmerican Express

 Coming Up in XRay

There are plenty of great sessions coming up on XRay this year. Watch them live on XRay or catch up in a time to suit you.

Don’t forget to ask your questions in advance to

07.15 GMTOct 14thEuropean Morning Call
10.00 GMTOct 14thLIVE Earnings Season Preview
15.45 GMTOct 15thAsset of the Day: Oil Outlook
19.00 GMTOct 15th LIVE Trader Training
18.00 GMTOct 17thThe Stop Hunter’s Guide to Technical Analysis (Part 7)

Key Economic Events

There are lots of releases this week that are likely to impact the markets. Also remember that trade tensions and Brexit rumble on which make also cause volatility.

09.30 GMTOct 15thRBA Monetary Policy Meeting Minutes
09.00 GMTOct 15thGerman ZEW Economic Sentiment
08.30 GMTOct 16thUK CPI
12.30 GMTOct 16thUS Retail Sales
14.30 GMTOct 16thEIA Crude Oil Inventories
00.30 GMTOct 17thAustralia Employment Change, Unemployment Rate
08.30 GMTOct 17thUK Retail Sales
12.30 GMTOct 17thPhilly Fed Manufacturing
02.00 GMTOct 18thChina GDP, Industrial Production

Preview: Apple Q3 Earnings


Earnings season is in full swing and there’s a big name on the calendar this week.

Apple will announce its Q3 earnings after the market close on Tuesday, and it looks like it could be a mixed bag.

The tech giant saw revenue fall in the first two quarters of this fiscal year and a profits warning from Tim Cook at the start of the year. While guidance suggests that things are improving, this report could throw a few surprises our way.

“What we know: It’s tough in China, iPhone sales are not what they were, Services growth is strong,” said Neil Wilson, Chief Markets Analyst at MARKETS.COM.

“What we don’t know: if things have improved in China as was hinted at in the Q2 release and what the outlook for the rest of the year looks like. Q3 is always a bit dull, so as is often the case, the guidance for the rest of the year is key.”

The year so far

The Q2 report three months ago had its ups and downs, however Apple did report in-line earnings and upbeat guidance for the next quarter.

Guidance for the fiscal third quarter of $52.5bn-$54.5bn was particularly impressive, and well ahead of forecasts.

While Apple’s Q2 results overall were a boost to the tech sector, iPhone revenue came under pressure as it dropped 17% to $31.1 billion. Greater China sales were down 22% from the year previous, but the report hinted that things were improving, with sales picking up as the quarter progressed.

Overall revenues were down 5%, in line with consensus. EPS came in at $2.46.

Services revenues climbed to an all-time high of $11.45bn, up 16% from the year ago period, as the tech giant switches much of its attention (and investment) away from products towards services and software.

“Of course, this is very strong,” Wilson said. “But we did note at the time some mild concern that the growth rate is slowing from the fiery levels we saw last year when we got +30% prints.”

What to expect

This report will include earnings for Q3, but also the outlook for the upcoming two quarters. These will be interesting given the worries about the iPhone. Following the Q2 report, Tim Cook admitted that consumers were slower to upgrade to a new handset. This is likely to be further impacted by the guidance for the 5G refresh.

Apple’s recent acquisition of Intel’s smartphone modem business for $1bn suggests they are committed to making improvements that consumers want. However, 5G is not expected until 2020, so the iPhone 11 refresh due this autumn will likely only have small tweaks – something consumers are increasingly unwilling to give up their existing handset for.

It’s quite likely, therefore, that consumers will wait for the release of the 5G models next year, putting further pressure on iPhone sales.

In terms of what to expect about services, Wilson said: “Not only are we looking at the absolute growth rate here, but also the impact on margins for the company as a whole and the shift in the balance. Apple Services margins came in at 63.8% in Q2. For the group, management guided gross margin to be between 37% and 38%.

“However, Services makes up about 20% of Apple’s revenue, up from 16% a year before – at what point can Apple start to guide its margins higher? This could be an area for an upside surprise, if not now then perhaps heading into the year-end. A slowing in the Services growth rate from the 16% in Q2 would be a concern.”

We’ll also be on the lookout for data about the new services launched in March – News Plus, Apple Arcade, and Apple TV Plus. At the time, Cook was keen to stress that these new ventures are not hobbies and the tech firm had serious ambitions to succeed in these new markets. The Q3 report should provide some early indicators.

Finally, we’ll also be looking for any insight into how Apple thinks the ongoing trade war with China will pan out. Cook had been more positive in Q2, but the White House has insisted that there will be no tariff relief for Apple products made in China. And, the third quarter report could include scope for further acquisitions, if the recent Intel deal is anything to go by.

In terms of estimates, Wilson said: “Consensus estimates forecast revenues to remain flat year-on-year in Q3 at $53.4bn, with EPS seen at $2.10 against $2.34 a year before.”

A closer look at share price

The profits warning at the start of the year saw Apple shares take a hammering, but shares have rallied close to 50% since then.

“Breakout to $211 and beyond? Bulls looking for a break north of $211 but this could offer resistance. Sustained rally beyond $211 starts to bring all-time highs in view again. If there’s disappointment, the support trend line comes in around $185.”

Key financials

On our platform, you can see the key financials for Apple ahead of the earnings report.

Netflix tumbles on subscriber woes


The latest earnings report from Netflix rattled investors and sent the stock tumbling in afterhours trading and languishing during yesterday’s session.

Netflix was off 17% on Wednesday evening and, despite paring gains during trading yesterday, closed 11% lower.

According to the new numbers, Netflix lost 130,000 customers in the US during the second-quarter. It’s the first time the streaming service has reported dwindling subscriber numbers in eight years. Analysts had expected US subscriber numbers to grow 352,000 across the period.

Netflix is well established in the US, and overseas is where the true growth potential lies. But the numbers here are disappointing as well, with Netflix managing to add just under half (2.83 million) paid subscribers in international territories of the 4.8 million forecast by analysts.

Netflix stumbles as competitors line up

It’s a worrying sign of weakness at a time when competition in the video on demand space is heating up. Apple, Disney, AT&T and Comcast all have streaming services in the works. The launch of these will see popular content disappear from Netflix.

For instance, Disney’s streaming service will be the exclusive home of Marvel and Star Wars movie. The two most-streamed shows on Netflix – The Office and Friends – will soon been removed as they head to Comcast’s streaming platform and HBO Max, run by AT&T, respectively.

Netflix said in a letter to shareholders that it believed the second-quarter “content slate” was less appealing than it had anticipated, driving fewer signups. The company also noted that subscription rates had slowed slightly more in regions where prices have recently increased than in those where the cost has remained unchanged.

Can Netflix afford not to raise prices?

This could reveal that Netflix is in a tricky position. With so many competitors, Netflix may find itself unable to raise prices as users can easily switch to an alternative video on demand service. But in order to stay attractive Netflix needs to continue investing heavily in content – and this does not come cheap.

Netflix has enjoyed a long run as the King of streaming. But it’s an expensive crown to keep, and the coming few quarters will see many new challengers to the throne step forward.

Eurozone bank shares slip further on weak yields, eyes on Fed speeches


Eurozone bank shares are amongst the worst performing today. The sector has fallen 1% overall, greatly outpacing the wider market dip.

The biggest movers include Sabadell, with losses in the region of 1.1%, Credit Agricole, off 1.5%, UBI Banca, down 1.7%, and ABN Amro, also down 1.7%.

The sector has been hit by weak Eurozone government bond yields, which are currently hovering just above record lows. The German 10-year bund currently yields -0.311%. That’s just above the -0.329% record low seen last Tuesday.

All eyes are back on the Federal Reserve ahead of a set of speeches, including one from chair Jerome Powell during the US session.

Federal Open Market Committee members signalled after last week’s policy meeting that a rate cut was on the way. This wasn’t enough for President Donald Trump, who responded that the Fed “blew it”. The President called a few months ago for 100 basis points of cuts and the reintroduction of quantitative easing.

Markets are waiting to see whether the Fed will bow to pressure and crank up the dovish rhetoric. President Jerome Powell has so far had little time for the President’s attempts to intervene. But with market expectations racing way ahead of what the data and policymakers themselves would suggest is necessary and a President intent on getting a weaker dollar to help him in his trade battle with China, can the Fed afford to go at its own pace?

Elsewhere stocks were holding near opening levels, with losses capped by the merger of two of the biggest business consultancies in Europe. The deal sees Capgemini purchasing Altran for €3.6 billion. Shares of Capgemini are up 7% to trade at a 2-month high, while Altran shares, reflecting the selling price, have shot up 21%.


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