Thursday,
April 21, 2022
Market recap
Dow Jones
35,160.79
+249.59 (+0.71%)
S&P 500
4,459.45
ā2.76 (-0.062%)
Nasdaq
13,453.07
-166.59 (-1.22%)
Top Story
Dow Rises but Nasdaq Falls in Choppy Session, Home Prices Remain at Historic Levels
• US stocks were mixed Wednesday, as the Dow was boosted by a strong earnings report from Procter & Gamble, but a downbeat report from Netflix weighed on the Nasdaq Composite. Netflix reported a net loss of subscribers, weighing on other streaming companies.
• The median price for a US home checked in at $375,300 in March. Extremely tight inventory and rising mortgage rates continue to make life difficult for homebuyers.
• The Fed released its Beige Book, also known as the Summary of Commentary on Current Economic Conditions. The central bank says the US economy grew at a moderate pace in early spring, due to inflation and geopolitical instability.
What to Be on the Lookout for Today
• Jobless claims are due, which rose slightly last week but remained near a 50-year low. Federal Reserve chair Jerome Powell is also scheduled to give a speech, and leading economic indicators will be published.
• American Airlines (AAL) will publish earnings, after an upbeat forecast from Delta Air Lines (DAL) boosted the entire industry last week. Despite rising oil prices, and resulting fare hikes, demand for air travel is expected to remain strong this summer according to many analysts.
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A Few Headlines That Should Be on Your Radar
Would you sign on for a cheaper version of Netflix (NFLX) if it included ads? Itās something the streaming platform is considering after reporting a net loss in subscribers during its most recent quarter. After it reported the loss of subscribers, and predicted the trend will continue, competitors like Disney (DIS), Warner Bros. Discovery (WBD), and Paramount Global (PARA) saw their share prices move lower. Some wonder if Netflix has already hit its peak ā but other signs suggest thereās room for growth. Read more >> Where do investors still find growth in an environment where growth stocks are facing pressure? Here are three themes that SoFiās Head of Investment Strategy thinks can produce growth over the next 2-5 years, and are worth taking a look at while theyāre trading at lower levels in a bumpy market. Liz finds this market just as challenging as anyone, but she also recognizes that there are always things to buy if we can keep our eyes on the 2-5 year prize. Read more >> Chipotle (CMG) announced plans to invest $50 million venture capital to fund technological progress in the food space, reflecting a broader industry trend to innovate. The funding targets tech companies that are up to the Series B stage. From robotics to apps, restaurant operators and food service providers are looking for technological solutions to better serve their customers while boosting revenue. Companies joining Chipotle in this goal include Starbucks (SBUX), Yum (YUM), and Inspire Brands. Read more >> Homebuyers choose the number of years theyād like their mortgage to last. The term that will work best for each borrower largely depends on the monthly mortgage payment they can handle and how long they plan to keep the property. Finding the right mortgage term can be tough, but knowing the pros and cons of various options can help narrow the field. Read more >>Not-So-Breaking News
- Netherlands-based Just Eat Takeaway (JTKWY) is considering the sale of Grubhub, after it acquired the US food delivery app just under two years ago. This follows a reported decline in orders compared to the high level of activity observed during COVID-19 lockdowns. Over the first three months of 2022, Grubhub orders fell by 1%.
- Procter & Gamble (PG) beat Wall Streetās estimates on the top and bottom lines in its most recent quarter, as the company reported productivity savings and price hikes helped maintain margins. The consumer goods corporation also raised its revenue growth forecast for fiscal 2022, adding inflation is likely to rise within the current three-month period.
- Lululemon (LULU) reported that market expansion, customer experience, and product innovation will be its main drivers of growth in the coming years, as it looks to double its 2021 revenue over the next half-decade. This would put the workout-clothes retailer on track to hit $12.5 billion in revenue by 2026. Lululemon also teased the future rollout of a membership program, as well as expansion into Spain and Italy with brick-and-mortar stores.
- Multinational financial services company Nasdaq Inc. (NDAQ) announced it will issue a stock dividend of two shares for every share held in what will be a 3-for-1 stock split. The company will also raise its quarterly dividend by 11%. Nasdaq said its first-quarter profit fell from the year-ago period.
- Oil services company Baker Hughes (BKR) failed to meet analyst expectations on both the top and bottom lines in its first-quarter, which executives blamed on highly volatile market conditions as well as supply chain disruptions. The company says oil and gas prices provide a favorable backdrop for the rest of 2022, while adding that operating costs are likely to remain in flux.
Financial Planner Tip of the Day
āWhen getting ready to buy a house, after assessing your budget and affordability, you may want to give yourself time to save up for a larger down payment. Buyers who put down less than 20% may end up paying private mortgage insurance, which typically costs between 0.3% and 1.5% of your loan amount annually.ā
Brian Walsh, CFPĀ® at SoFi