Tuesday,
April 5, 2022
Market recap
Dow Jones
34,921.88
+103.61 (+0.30%)
S&P 500
4,582.64
+36.78 (+0.81%)
Nasdaq
14,532.55
+271.05 (+1.90%)
Top Story
Both Stocks and Energy Prices Rise, Factory Orders Decline in Spending Shift
• US stocks rose Monday as the market continues to shake off fears tied to a potential economic downturn. A key portion of the yield curve remains inverted, with short-term US Treasury yields higher than their long-term counterparts. Traders bought up shares of tech stocks, boosting the Nasdaq Composite.
• Since 1955, the yield curve of 10-year and 2-year Treasuries has inverted before all the US recessions that have occurred. An inverted yield curve doesnât mean that a recession is imminent, but it may suggest that bond investors are concerned about the economyâs short- to medium-term prospects.
• Russiaâs invasion of Ukraine remains prominent on investorsâ minds. President Biden has called for Russian President Vladimir Putin to be tried for war crimes. Energy markets have been highly volatile since the invasion. The price of oil and natural gas moved higher yesterday.
• Factory Orders fell in February, which was in line with expectations. Analysts attribute this to an ongoing shortage of raw materials and a broad shift in spending from manufacturing to services.
What to Be on the Lookout for Today
• Februaryâs foreign trade deficit is set for release. The deficit rose by 9.4% to hit a record $89.7 billion in January. Analysts attributed this to a significant uptick in imports, as well as higher prices.
• Apparel company Levi Strauss (LEVI) will report earnings. Several weeks ago, the company joined a number of global brands in suspending sales in Russia following the invasion of Ukraine.
• Cannabis stock Tilray Brands (TLRY) is also scheduled to share its most recent results. The House of Representatives recently passed a bill that would decriminalize marijuana on the federal level, but some experts say laws regarding so-called cannabis banking are more likely this year.
Calculator: How Much Home Can You Afford?
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A Few Headlines That Should Be on Your Radar
Billionaire Elon Musk has thrown his hat into the social media ring in a big way by taking a large stake in Twitter (TWTR). His vocal criticisms of the platform suggest that he is looking to shake things up. Just last week, Musk flirted with the idea of launching his own social media company. Mr. Musk has alleged that Twitterâs content management structure is akin to censorship and harms free speech. His stake in the company may lead to changed policies regarding restrictions on what people choose to post. Read more >> Birkenstock is aggressively moving to maintain market share. This involves a crackdown aimed at getting copycat products off the shelves. The company has been accused of âcompetitive bullyingâ as it pressures retailers to curtail the competition. As the copycat crackdown continues, consumers who have their hearts set on certain brands and styles may have to do a little more work to find them. Read more >> Meta Platforms (FB) has TikTok on the mind, and Mark Zuckerberg says its own short-form video product Reels is the companyâs top priority. In order to attract content creators, a revenue sharing program has been rolled out. After the progress made by Instagramâs Stories, can Reels follow a similar path? The Stories content form was launched in response to the success of Snapchat (SNAP), and executives say ad revenue now matches up with Feed posts. Itâs new territory for Meta overall, after Facebookâs user base stopped growing recently. Meanwhile, TikTok is on the rise. Read more >> Letâs face it: Even if youâre making a decent (or heck, a pretty awesome) salary, saving up 20% of the total cost of a home can be difficult â especially if youâre paying rent, juggling student loans, and trying to reach other long-term goals like saving up for a retirement. While 20% percent down on a home mortgage loan has long been the standard, it might be beneficial for some to put down less. These tips may help you better identify the loan programs that best fit your financial scenario to help put you on the road to owning your own home. Read more >>Not-So-Breaking News
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Advanced Micro Devices (AMD) is set to acquire cloud startup Pensando for $1.9 billion, as the chip designer looks to expand its data center holdings. Pensando was founded in 2017 by a group of engineers who previously worked for Cisco (CSCO). Its client list includes Microsoft (MSFT) and Goldman Sachs (GS).
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Hertz (HTZ) says it will purchase 65,000 electric vehicles from Polestar as the rental car giant looks to electrify its fleet. Polestar is a startup and one of Teslaâs (TSLA) competitors. Its Polestar 2 sedan makes up the bulk of Hertzâs acquisition.
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Coffee giant Starbucks (SBUX) announced itâs suspending its share buyback program with Howard Schulz retaking control of the company. Starbucks didnât repurchase any shares in fiscal 2021, but recently announced it intends to spend upwards of $20 billion on dividends and buybacks between now and 2025.
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Ford (F) says the ongoing global shortage of semiconductor chips is to blame, as the automaker's US sales of new vehicles declined 17% in the yearâs first three months. Just last month, sales fell by 26%. First-quarter sales figures matched Wall Street forecasts.
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JP Morgan (JPM) CEO, Jamie Dimon, warned investors that geopolitical pressures, including Russiaâs invasion of Ukraine, could end up costing the bank $1 billion from its bottom line. This is largely due to JP Morganâs exposure to Russia. Dimon also cited the ongoing dispute between China and the US concerning trade.
Financial Planner Tip of the Day
âWhile not everyone loves the idea of budgeting, taking a moment to assess and prioritize your spending can yield some real rewards. Even a basic monthly budget can help you reach your financial goals, whether itâs to have a financial cushion, put a downpayment on a new home, go on your dream vacation, or all of the above.â
Brian Walsh, CFPÂŽ at SoFi