Friday,
February 4, 2022
Market recap
Dow Jones
35,110.34
-518.99 (-1.46%)
S&P 500
4,477.34
-112.04 (-2.44%)
Nasdaq
13,878.82
-538.73 (-3.74%)
Top Story
US Stocks Fell as Meta Platform’s Weak Earnings Spark Sell-Off
• US stocks fell Thursday. This ended the market’s four-day rally as investors reacted to Meta Platforms’ (FB) weak earnings report. Social media competitors Twitter (TWTR), Pinterest (PINS), and Snap (SNAP) saw their share prices dip following Meta’s weak performance. Zooming out, the tech sell-off caused all three major indexes to finish in the red.
• Initial jobless claims came in at 238,000. This is slightly below what analysts had anticipated. It’s also the second straight weekly decline. Market observers argue this shows the Omicron variant’s impact is easing.
What to Be on the Lookout for Today
• A series of key labor market indicators are due. January’s non-farm payrolls, monthly unemployment rate, and average hourly earnings for January will be released. The labor force participation rate for January, which as of December remains below pre-pandemic levels, is also on the docket.
• Healthcare sector titan Bristol-Myers Squibb (BMY) releases earnings. Company executives have predicted that revenues will decline for the next several years, largely due to expiring protections for core drugs like Eliquis and Revlimid.
How Does CARES Impact You?
The CARES Act is like a moving target, especially if you have a federal student loan. Brian will explore what the CARES extension means for you and what to do next. Get the details in the SoFi app!
A Few Headlines That Should Be on Your Radar
For the first time in its history, Facebook’s user base has stopped growing. It’s an alarming trend for the social media giant. Plus, making acquisitions in order to grow the user base may prove difficult due to regulatory scrutiny. Executives plan to focus on Instagram “Reels,” while the parent company eyes the larger metaverse. Read more >> Property owners dealing with shopping mall vacancies—including the loss of anchor tenants—are leasing space to hospitals and medical centers. Analysts say this is part of an ongoing trend where property owners are seeking out tenants that provide services rather than sell physical goods, which is increasingly done online. Hospitals may prefer mall locations because of their accessible parking, proximity to main roads, and nearby customers. Read more >> Private equity is flowing into aspects of ecommerce including subscription management and lending for merchants facing supply-chain issues. While the ecommerce sector is booming, merchants must confront a number of challenges tied into logistics. Analysts identify managing subscriptions and overcoming short-term funding issues as areas of need. Read more >> The idea of student loan forgiveness gets tossed around seemingly every year—but will it ever happen? Here’s a look at some of the considerations. Question marks swirl around student debt cancellation. Amid all the noise about the topic, it may be a good idea to take measure of your student loan rates and terms and plot a smart course. Read more >>Not-So-Breaking News
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Apparel company Ralph Lauren (RL) easily beat analyst expectations for revenue, saying demand for luxury items helped drive sales throughout the holiday shopping period. Other high-end brands like Prada (PRDSY) and Versace (CPRI) have reported a similar demand for products since pandemic lockdowns were lifted.
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Hershey (HSY) beat analyst expectations on the top and bottom lines in its most recent quarterly report. The company is also forecasting future growth in profits, saying price increases will offset costs associated with new hires, logistics, and rising prices for raw materials.
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Penn National Gaming (PENN) beat analyst expectations for revenue but missed on earnings, with the gaming and esports company blaming rising costs amid a hyper-competitive gaming market. It also announced plans to purchase the portion of Barstool Sports it doesn't already own early next year.
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US drugmaker Merck (MRK) is predicting it will eventually sell upwards of $5 billion to $6 billion worth of its COVID-19 treatment pill, which the FDA had approved in December. To date, these pill sales are largely concentrated in the US, UK, and Japan.
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British oil giant Shell (SHEL) posted a notable increase in profits for 2021 and announced an expanded share buyback program. The company reports it is also expecting to increase its dividend by 4%. Market observers say Western energy companies are looking to demonstrate stability following COVID-19’s major impact on the oil market two years ago.
Financial Planner Tip of the Day
“An integral part of financial wellness is having a cash reserve. Research shows that having cash to cover the unexpected has the biggest impact on financial stress, anxiety, and satisfaction.”
Brian Walsh, CFP® at SoFi