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Rate-Driven Uncertainty Causes Major Averages to Fall Friday
• US stocks fell Friday as Treasury yields creeped higher. After Thursday's hotter-than-expected inflation reading, the 10-year Treasury yield topped 2% for the first time since 2019. Investors are trying to determine what steps the Federal Reserve will take to cool the economy. The uncertainty caused all three major indexes to fall on the final day of the week.
• The University of Michigan's preliminary consumer sentiment reading for February also soured sentiment on the Street. The figure came in at 61.7 — its lowest level in more than a decade. The reading missed expectations and fell from the previous month.
What to Be on the Lookout for Today
• There is no economic data scheduled to be released, but there will certainly be a lot of money changing hands. Some estimates expect Valentine’s Day spending to reach $23.9 billion this year.
• Avis Budget Group (CAR) will hand in its report for the most recent quarter, with analysts predicting sales of $2.4 billion. This would represent a year-over-year revenue increase of 76.5% for the car rental company. Research indicates the popularity of online car rental services is fueling growth for the industry as a whole.
The Week Ahead at SoFi
With today’s volatile market, you need to invest for the long term. Brian will break down how to best invest for your goals. Plus, join us for Your Next Dollar. Save your seat for these free events!
A Few Headlines That Should Be on Your Radar
The week ahead on Wall Street includes more inflation data and further insight into the housing market. After last week’s consumer price index showed prices rising at their fastest level since 1982, we’ll get a closer look at what’s happening with inflation at the wholesale level. Elsewhere, housing supply has proved tight in recent months — available inventory is at its lowest level since 1999. Read more >> Fewer people are enrolling in traditional colleges and universities, which could offer long-term opportunities for growth within the educational tech sector. The trend lines may not be great for higher education, but education tech companies that provide cheaper degrees and study tools could be in a position to benefit. Employers may also prefer utilizing educational tech platforms to train existing employees as opposed to hiring outside workers, given the tight labor market. Read more >> Luxury brands are less interested in renting out space in airports, and passengers are buying goods ahead of flights less often. It’s an unwelcome trend for airports who are limited in their ability to charge airlines higher fees and have traditionally relied on high-end brands as tenants in terminal shops. Analysts explain Chinese tourists are buying more goods at home, which makes airport space less attractive to luxury brands, given that was a coveted market. Read more >> Buying life insurance is a big decision — one that is often a long-term commitment — so you are probably wondering how much it will cost. How much is life insurance? Premium costs may vary from individual to individual. Here’s a look at factors that might affect the cost of life insurance. Read more >>Not-So-Breaking News
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Online real estate platform Zillow Group (ZG) reported better-than-expected fourth-quarter revenue on Friday as well as a $195 million dollar gain for 2021 as a whole. Zillow also announced plans to wind-down its home flipping business Zillow Offers, which comes sooner than analysts expected.
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Under Armour (UAA) says ongoing supply-chain issues continue to pose challenges, although the company did beat analyst estimates on the top and bottom lines. Executives say increased freight costs will sap future profits as Under Armour has been using more expensive air cargo to bypass shipping delays.
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Goodyear Tires (GT) easily beat analyst expectations for earnings in Q4 2021 while posting revenue that approached a 10-year high. Executives say higher prices helped combat rising costs attributed to inflation, adding they don't expect inflationary pressures to fully back off until sometime next year.
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Delivery Hero (DELHY) CEO Niklas Ă–stberg is apologizing to shareholders after the company's stock price plummeted 30% last Thursday. The sell-off came after the Berlin-based food delivery service provided weaker than expected sales estimates for 2022. Delivery Hero currently operates in over 50 countries.
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Semiconductor Manufacturing International Corporation, China's largest chip maker, reported record revenue and soaring profit for 2021 amid the global chip shortage. SMIC has announced plans to build three new plants and invest $5 billion into capital projects. In 2020 the US government placed the company on its trade blacklist, known as the Entity List.
Financial Planner Tip of the Day
"Ideally, your life insurance payout should be enough to invest and yield returns that could replace your income annually. For example, if you assume that you’ll get a 5% return on the money you invest, you would need $1 million in coverage to replace a $50,000 income."
Brian Walsh, CFP® at SoFi