Tuesday,
March 15, 2022
Market recap
Dow Jones
32,944.91
+0.72 (0.00%)
S&P 500
4,173.10
-31.21 (-0.74%)
Nasdaq
12,581.22
-262.59 (-2.04%)
Top Story
Market Down Amid Ongoing Ukraine-Russia Concerns, Commodities Stay Volatile
• US stocks fell Monday as the ongoing Ukraine-Russia conflict continues to weigh on investor sentiment. Fighting continues in and around the Ukrainian capital of Kyiv, where officials say they will continue to push for a ceasefire and the removal of Russian troops.
• Commodities remain in focus as prices for various assets have been volatile recently. Although they’ve been on an upward march, oil prices fell yesterday, which some analysts attributed to China’s latest coronavirus lockdowns and their potential to dent demand. Meanwhile, nickel trading was suspended on the London Metal Exchange in response to soaring prices last week. Elsewhere, the price of gold and palladium moved lower during yesterday’s session.
What to Be on the Lookout for Today
• February’s producer price index is due. The PPI measures how selling prices change on average over time, in terms of domestic producers’ output. In January the number rose by 1% on a monthly basis, and 9.7% on an annual basis — not far from the highest rate ever recorded. The Empire State Manufacturing Index for March will also be published, which is a survey taken by the Federal Reserve Bank of New York in an attempt to gauge the performance of New York’s manufacturing sector.
• The Federal Reserve begins its two-day meeting where it is expected to enact a 25-basis-point hike to its target rate. This effectively governs what interest banks and depository institutions charge each other when lending money. This comes amid the fastest rate of inflation since 1982, with prices up 7.9% on average over the past 12-months.
• Volkswagen (VWAGY) is set to publish its earnings for 2021 as a whole, in addition to its data for the most recent quarter. Analysts predict the company will report increased revenue compared to 2020. Just last week, Volkswagen announced plans to set up a new factory in Germany where its all-electric sports sedan called Trinity will be produced. Meanwhile, the automaker has also dealt with production disruptions as a result of the Russia-Ukraine conflict.
Financial Freedom 101 with Author and Founder Claire Wasserman and SoFi’s Kendall Clayborne
Join Claire Wasserman, author and founder of Ladies Get Paid, and SoFi’s Kendall Clayborne as they explore what it means to become financially independent, plus get tips on the first steps you need to get there. Save your seat!
A Few Headlines That Should Be on Your Radar
China’s zero-COVID-19 policy is having a big impact on the world’s economy, and the effect could be even more significant as a result of the easier-to-spread Omicron variant. Apple (AAPL), Ford (F), and Toyota (TM) are among the companies most affected by the latest lockdowns. When cases are identified in China, authorities lock down entire cities, closing factories and severely disrupting production as a result. Most recently, Shenzhen and Changchun were shut down, and both are marketing hubs within the electronics and auto industries. Read more >> Direct-to-consumer brands like Warby Parker (WRBY) and Stitch Fix (SFIX) are stumbling as new market dynamics turn hostile. Analysts blame soaring Facebook (FB) ad prices, stricter Apple (AAPL) iOS privacy rules, and crippling cost increases from supply-chain disruptions. When the direct-to-consumer model burst on the scene it seemed lean and nimble, eliminating the need for a middleman and lowering overhead. The growth of ecommerce only served to push investor enthusiasm and valuations higher. Recently stock prices have plummeted and this has some analysts wondering if direct-to-consumer can change things up, possibly through the effective use of TikTok and other platforms. Read more >> The Federal Reserve is expected to raise interest rates this week with the first of what could be several hikes before the end of the year. Advisors say how much it affects you could depend on your monthly bills and what you’re looking to buy. When interest rates are raised spending typically slows down, helping to lower prices. With inflation at 7.9% over the past year, the central bank is looking to take steps that could “cool off” the economy. Credit cards, student loans, car payments, and mortgages could all soon cost you more. Read more >> Not all IPOs end up succeeding and many times fail. Here are some of the worst IPO failures in history. An Initial Public Offering or IPO represents a company’s first foray into the world of publicly-traded stock. While an IPO can be highly anticipated by the company, prospective investors and the market, success isn’t always guaranteed. Read more >>Not-So-Breaking News
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Ford (F) announced plans to ramp up electric vehicle production in Europe, as well as a partnership that will build a major battery production facility in Turkey. The EV production based out of Cologne, Germany, is forecast by the company to reach 1.2 million over a six-year period.
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Chinese tech giant Tencent slumped Monday in Hong Kong, with shares down nearly 10% at market close. This followed a report in the Wall Street Journal indicating the company may be facing a record-high fine for allegedly violating anti-money laundering rules.
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Uber (UBER) says it will enact a fuel surcharge in response to surging gas prices. The move takes effect tomorrow and will cost users between $0.45 and $0.55 per trip. There will be similar surcharges for Uber Eats. The company indicates this will be in effect for at least two months, with all the money going to its drivers.
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Reports say Germany is set to purchase over thirty F-35 fighter jets from Lockheed Martin (LMT), which will replace its aging Tornado aircraft. As of now, the Tornado is the only German jet that can carry US nuclear bombs, which are stored at a base in Germany under a NATO agreement.
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Canadian miner Turquoise Hill Resources (TRQ) said it’s reviewing Rio Tinto’s (RIO) offer to buy out the remaining 49% of its shares it doesn’t already own. The cash-offer comes out to around $26.68 per share. Turquoise Hill is primarily involved in copper and gold mining in Mongolia.
Financial Planner Tip of the Day
"People who are reluctant to invest all at once might consider dollar cost averaging. This means making regular contributions over an established period of time, which can help lower the cost basis of your investments over the long term."
Brian Walsh, CFP® at SoFi