Wednesday,
June 29, 2022
Market recap
Dow Jones
30,946.99
ā491.27 (ā1.6%)
S&P 500
3,821.55
ā78.56 (ā2.0%)
Nasdaq
11,181.54
ā343.01 (ā3.0%)
Top Story
Last Weekās Rebound Seems to Have Fizzled, Oil Prices Rise, Consumer Confidence Falls
• US stocks fell as last weekās bear market bounce seems to have fizzled. All three major indexes gave up early gains. Investors continue to look for clues as to how the Fed will proceed with its monetary policy.
• Overseas, Chinese authorities announced plans to relax COVID-19 restrictions. Oil prices rose as traders assess what that could mean for demand in the worldās second-largest economy.
• Juneās consumer confidence index came in lower month-over-month. The reading fell for a second consecutive month and came in at its lowest mark in 16-months. Consumers are worried about the general health of the economy as well as inflation.
• The S&P Case Shiller Home Price Index showed prices for single family homes rose more slowly year-over-year in April in comparison to March. Analysts connect this to rising interest rates forcing would-be-buyers to the sidelines.
What to Be on the Lookout for Today
• Federal Reserve Chair Jerome Powell is scheduled to speak alongside the European Central Bankās president. At a separate event St. Louis Fed President James Bullard will deliver opening remarks.
• The US first-quarter GDP will be released. During Q4 2021 the economy contracted by 1.5%.
• The Mortgage Bankers Association will release weekly mortgage applications. Last week applications for mortgages went up 4.2%.
• General Mills (GIS) will report earnings for both its fourth quarter and fiscal 2022 as a whole. Last week the food company announced it had closed a deal to acquire TNT Crust, which makes frozen pizza crusts that are sold nationally to a variety of clients including pizza chains.
How Investments Make Money
Many people are afraid to start investing because they donāt have a basic understanding of how it works. And thatās smart. You donāt want to invest your hard-earned money in something you donāt understand.
But itās also not smart to sit on the sidelines. Because, well, simply socking money away in your savings account probably isnāt going to earn you the kind of returns you need to achieve your big financial goals.
Basically, investments make you money in one of three ways:
• Income: Cash paid to you periodically from your investments
• Capital Appreciation: Owning things that could go up in value over time (like stocks, gold, or real estate)
• Pass Through Profits: Investing in private businesses and real estate, which may pass through the profits from their operations.
While there are no guarantees, investments can make money in many different ways. But, they canāt do any of them if you donāt get started. If youāre not sure what to do next, we can help.
An online investing account with SoFi makes it easy: Our Auto Invest platform helps you determine the right asset allocation mix for you, while advisors are available to offer you complimentary, personalized advice if you need it. Sign up for SoFi Invest, and consider working with an advisor today.
A Few Headlines That Should Be on Your Radar
As kids enjoy summer vacation and parents stock up ahead of the return to class, the retail sector is studying hard. Thatās because back-to-school shopping informs retailersā plans for later in the year. Research suggests three major trends are emerging. All of that spending activity gives companies insight into how Americans are spending. With inflation spiking, firms need to know what people are willing to spend on and how much. Read more >> Rental prices have increased about 14% from a year ago on increased demand from people who can no longer afford to purchase a home. As demand shifts from buying to renting a home, landlords are bumping up rents. The trend may continue into the foreseeable future, but market observers contend continued increases in rents canāt be sustained. Read more >> Consumer-oriented buy now pay later schemes are losing steam and investor interest. Meanwhile, a new crop of startups in Europe sees profits in tweaking the BNPL model to a focus on businesses. B2C company Affirm (AFRM) has seen its valuation plummet amid recession concerns and regulatory scrutiny, while European B2B BNPL start-ups are raking in millions from investors. Read more >> Portfolio rebalancing can seem complicated, but adjusting the asset allocation of your investments is key to any diversification strategy. Generally, investors can rebalance their portfolios as often or as little as they want. It all depends on individual circumstances and goals. Hereās what to know to execute this investment strategy. Read more >>Not-So-Breaking News
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Nike (NKE) reported better-than-expected results on its top and bottom lines with executives crediting strong direct-to-consumer sales. The sports retailer also predicted high transportation costs and the strong US dollar would negatively impact profits.
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Joffre Capital has acquired a $2.2 billion majority stake in Playtika (PLTK). The technology buyout firm now owns 25.7% of the online casino gaming company.
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JPMorgan (JPM) and Citigroup (C) have announced their dividends will remain unchanged. The two banks blamed increasingly stringent capital requirements for limiting their financial flexibility. The move diverges from competitors such as Morgan Stanely (MS), which boosted its payout.
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Toshiba (TOSYY) shareholders have approved adding two board directors who hail from activist hedge funds Elliott Management and Farallon Capital. Industry observers believe this reflects the Japanese tech giantās interest in exploring buyout opportunities.
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Ernst & Young will pay a $100 million fine to settle SEC charges that employees cheated on their CPA exams. The accounting firm admitted its ethics breach. Itās the biggest fine the SEC has ever imposed on an auditing firm.
Financial Planner Tip of the Day
"Traditional IRAs or 401(k)s allow you to contribute pre-tax dollars to an account. You can save money on taxes now and only pay taxes on your investments when you withdraw from the account."
Brian Walsh, CFPĀ® at SoFi