Wednesday,
August 3, 2022
Market recap
Dow Jones
32,396.17
-402.23 (-1.23%)
S&P 500
4,091.19
-27.44 (-0.67%)
Nasdaq
12,348.76
-20.22 (-0.16)
Top Story
Stocks Slip With Speaker Pelosi in Taiwan and Fed Sounding More Hawkish
• US stocks fell Tuesday as heightened geopolitical tension and hawkish comments from the Fed may have soured the mood on Wall Street. House Speaker Nancy Pelosi’s trip to Taiwan potentially left the market rattled. Meanwhile, Russia’s invasion of Ukraine has already weighed on equities for several months.
• San Francisco Fed President Mary Daly gave an interview and said the central bank is “nowhere near” done with rate hikes. This is noteworthy as investors have been attempting to gauge what the Federal Reserve is planning over the coming months. If the market is convinced the central bank won’t slow the pace of hikes, stocks could suffer.
• Job openings fell to a nine-month low in June. Analysts say this suggests the tight labor market is loosening up. As the Fed has hiked rates in an attempt to cool off inflation, the robust state of employment has remained a bright spot. Job openings checked in at 10.7 million — down from 11.3 million in May, and lower than most predictions.
What to Be on the Lookout for Today
• The market will get a snapshot view into how the services sector performed last month. S&P Global’s services PMI and ISM’s services index are set for release. June’s factory orders are also due.
• Some real estate data is also on the way. The second-quarter’s rental vacancy rate and homeowner vacancy rate will be published.
• Travel website Booking.com (BKNG) will publish earnings during what’s been a period of soaring demand for the sector. Booking has a summer promotion in partnership with The Smiley Company, who made the iconic smiley face logo 50 years ago. It offers savings on so-called “Smiley Stays.”
• Retail pharmacy chain CVS (CVS) is scheduled to hand in its most recent report card. New York Attorney General Letitia James sued the company last week alleging it had harmed safety net hospitals and violated antitrust laws.
Your Credit Card Utilization Matters Nearly as Much as Your Payment History. So What Does That Mean?
When it comes to what affects your credit score, one of the most important factors is how much credit you have available vs. how much debt you currently have. Called your credit utilization, you can calculate this number by dividing your outstanding debts by your total credit available.
Let’s say you have three credit cards with a total credit limit of $30,000. You owe $3,000 in total. So your credit utilization would be:
3,000/30,000=0.10
Your credit utilization of 10% (you’re using 10% of your total available credit) is great, as lenders generally want to see a utilization rate below 30% to approve a loan application.
Track your credit score for free in the SoFi app, where the factors affecting your score are broken out to make them easier to understand.
A Few Headlines That Should Be on Your Radar
Banks are signaling they’re confident US consumers can adjust to the current economic headwinds of high inflation and the threat of a recession. Financial institutions are still competing to win market share in credit cards, which are considered a key source of profit. Americans can expect enticing offers with hooks like 0% interest, hotel and airline points, and other perks. But what is so important about credit card offers, and how do they indicate what banking executives are thinking? Read more >> Consumer product companies are bracing themselves for a potential change in consumers’ buying habits. Employment is robust, but inflation is taking a bite out of Americans’ paychecks. Companies such as Danone (DANOY) and Kimberly-Clark (KMB) are attempting to predict changes in consumer behavior by deciphering mixed economic signals. For that reason, be on the lookout for package redesigns and a number of other changes. Read more >> Companies know workers don’t want to go back to the office. Tech firms, many of which helped make remote work possible during the scramble of 2020, are now focused on reversing the trend. Even hybrid work schedules require new thinking in terms of food, conference rooms, security, and air quality. Now tech companies are developing software and apps that aim to boost the in-office experience. Anyone for a yoga class on their lunch break? Read more >> When you set up direct deposit, you’ll unlock extra benefits within your SoFi account. Get paid up to 2 days early* and pay no account fees or overdraft fees^ when you set up direct deposit. Here’s a quick video to show you how easy it is to get started. Read more >>Not-So-Breaking News
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BP’s (BP) profits skyrocketed as the British petroleum company benefited from rising energy prices. The oil giant boosted its dividend by 10% and increased stock buybacks after the company’s profit tripled in comparison to Q2 2021.
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Maersk (AMKBF) reported better-than-expected revenue and raised its profit outlook. The Denmark-based container shipping giant said it benefited from strong consumer demand.
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DuPont (DD) announced revenue and profit above Wall Street expectations, but pulled back its earnings guidance. The chemicals company predicts weaker sales due to adverse currency exchange rates and downtime at a manufacturing site in Virginia.
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Avis (CAR) reported better-than-expected results on the top and bottom lines. The rental-car company’s CEO, Joe Ferraro, attributed the strong performance to "enhanced revenue generation, diligent fleet management, and stringent cost control."
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Cryptocurrency company Nomad reports it had $190 million stolen from users’ accounts. The San Francisco-based operation saw its “bridge” targeted. Bridges are used to transfer tokens between blockchains and have been a frequent target of hackers. In 2022 alone the crypto sector has seen $1 billion stolen in this fashion.
Financial Planner Tip of the Day
“No matter whether you’re taking an active, passive, or hybrid approach to investing, you’re likely to pay some fees. It's important to look carefully at the fees that you’re paying and to occasionally shop around to see if it’s possible to get similar investments for lower fees.”
Brian Walsh, CFP® at SoFi