Wednesday,
August 10, 2022
Market recap
Dow Jones
32,774.41
-58.13 (-0.18%)
S&P 500
4,122.47
-17.59 (-0.42%)
Nasdaq
12,493.93
-150.53 (-1.19%)
Top Story
Weak Guidance from Chip Stocks Weighs on Wall Street
• US stocks fell Tuesday. Weaker-than-expected revenue forecasts from major chipmakers like NVIDIA (NVDA) and Micron (MU) weighed on Wall Street sentiment, dragging down the tech heavy Nasdaq Composite index.
• On a better note, the NFIB Small Business Optimism Index improved slightly last month. Although inflation is still a major concern for businesses both big and small, the index climbed to 89.9 in July from 89.5 the previous month.
What to Be on the Lookout for Today
• The latest inflation data will be the talk of Wall Street as July’s CPI is set to be released. June’s reading showed prices rising 9.1% year-over-year. That market will be watching to see if the Fed’s rate hikes have caused inflation to level off. June’s revised wholesale inventories and July’s federal budget in comparison to the year-ago period are also due.
• Walt Disney Co. (DIS) is scheduled to report its latest results. Last week marked a milestone for the company’s Walt Disney World park in Orlando, as the remaining COVID-19 restrictions were officially lifted.
• Honda (HMC) is also on the earnings calendar. Last week the company announced it was halting the sale of 10 models of its motorcycles in Japan, due to a backlog of orders.
Exchange Traded Funds: The Suitcase That Packs Multiple Investments Together
As the investing landscape changes, there are a growing number of investment tools available to individual investors than ever before. Due to innovations such as the exchange-traded fund (ETF), even small and less-established investors can access good investing options.
An ETF bundles many investments together to be bought and sold in one neat and tidy package. The purchase of one ETF provides exposure to dozens or even hundreds of different investments at once.
This means that with just a few clicks, it is possible to buy one fund that provides exposure to hundreds or thousands of investment securities. ETFs are often heralded for helping investors gain diversified exposure to the market for a relatively low cost.
This is important to understand — the ETF is simply the suitcase that packs investments together. When you invest in an ETF, you are exposed to the underlying investment. For example, if you are invested in a stock ETF, you are invested in stocks. If you are invested in a bond ETF, you are invested in bonds.
If a new investor is unsure about particular stocks, but wants the flexibility of trading with exposure to the market, an ETF may be an option. SoFi utilizes the modern technology of ETF investing while providing a real live human advisor to answer questions, at no extra cost. Start investing in ETFs with as little as $5 on SoFi Invest.
A Few Headlines That Should Be on Your Radar
Analysts say inflation and a preference for experiential spending is harming video game sales. People who had time to sit in front of screens gaming during lockdowns are getting outside and spending cash elsewhere. Americans have slowed down their tendency to spend on “stuff,” and instead are opting for things like concerts, travel, and eating out at restaurants. But there’s another reason sales are down, and it’s connected to the latest editions of the Call of Duty and Battlefield games. Read more >> Inflation relief at last? Research from Adobe (ADBE) shows online prices fell for the first time in over two years. There’s a number of reasons why this is happening, including oversupply and diminished consumer demand, prompting retailers to cut prices. Still, there’s a major category that didn’t decline in July — and in fact set a new record. Read more >> With back-to-school shopping season in full swing, some states offer tax-free weekends, while others lower taxes on certain items. For parents, students, and teachers, everything helps. Illinois has reduced taxes on qualifying school purchases through August 14. Virginia is letting teachers apply a tax deduction for supplies they buy on their own. Here’s the what, where, and who behind the school year shopping spree. Read more >> Is the economic glass half-full or half-empty? It seems investors and the Fed view the state of the economy differently. Here’s SoFi’s Head of Investment Strategy’s market lookback for July 2022. Read more >>Not-So-Breaking News
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Hyatt (H) reported earnings that beat expectations, however its sales did miss estimates. Despite fears that pent-up travel demand will taper off after the summer, the hotel operator still sees robust demand continuing in the second half of the year.
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Although revenue jumped in the second quarter, higher costs caused Spirit Airlines (SAVE) to post a quarterly loss. JetBlue (JBLU) agreed to acquire Spirit for $3.8 billion late last month.
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Warner Music Group (WMG) announced profit and revenue figures that beat expectations on Tuesday. The music recorder and publisher also provided upbeat guidance citing a new wave of releases starting in June.
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Pointing to "sustained off-premise traffic," Dine Brands Global (DIN) reported second-quarter profit and revenue that topped expectations. The Applebee's and IHOP restaurant chains parent also said it was helped by a continued dine-in recovery.
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AppLovin (APP) offered to buy Unity Software (U) for $17.5 billion. The proposal might derail Unity's previously announced plan to acquire AppLovin's smaller competitor, ironSource.
Financial Planner Tip of the Day
“When making a decision about how to build a portfolio, you may want to keep in mind that risk and reward are two sides of the same coin. You cannot have one without the other.”
Brian Walsh, CFP® at SoFi