The weekly Trading Trends addition to #DisruptionBanking’s editorial is a new initiative. However, it could have come at a better time for markets. There may have been a moment of exhalation earlier in the week when markets seemed to be showing signs of recovering. But today things look anything but ‘rosy’.
Much like last week, Elon Musk was in the news again this week. Twitter’s share price had already “tumbled nearly 10% last Friday in its biggest move since Musk’s deal went public.” As time goes on excuses about fake/bot accounts on the platform by Musk are leading investors to wonder if he is stalling to get a better price for the Social Media platform.
What about Digital Assets?
In recent times its hard to remember a week when digital assets or crypto didn’t dominate market news. This week was no exception with news of Maker’s DAI becoming the fourth largest stablecoin by market cap. Cleaning up a lot of the leftovers from the fallout of TerraUSD last week. Binance and Gemini have also soaked up some of the fallout from TerraUSD, but the stablecoin is still hovering at around $0.09 per token. Will it ever get back to $1? Some investors still think so. However, good luck trying to buy TerraUSD, as many of the major exchanges still do not allow trading in the stablecoin.
The fallout from the TerraUSD debacle took a further twist this week. For the first time, a group of Korean investors have filed complaints with the prosecution in Korea against Do Kwon, Terraform Labs CEO and the firms other co-founder Daniel Shin for alleged fraud and violation of the law regulating fundraising. Citizens of other countries may follow suit.
It seems that crypto hasn’t been the only casualty of slumping prices, with NFTs also being affected:
Robinhood was also in the news. Predictably the innovative Fintech is creating its own crypto wallet. Not to be confused with their existing offering, the new wallet offers something different to users. With their share price at a record low, it seems like the company is grappling for ideas to continue growing. Robinhood’s share price has improved from $9 per share last week to $10.40 today. But it’s still a far cry from the $40 from late 2021.
One of the biggest pieces of news this week was from Coinbase though. The cryptocurrency exchange ‘let slip’ that customers’ money would get “jammed up” if the exchange ever went bust. With the share price continuing to tumble it might be time to consider if the exchange has a future at all with soundbites like this.
U.S. Consumer Confidence
On Tuesday this week Home Depot and Walmart reported Q1 earnings. However, Walmart shares slumped over 11%. Considered a ‘bellwether’ for how consumers are handing inflation, the Walmart earnings are a little depressing. Especially as consumers may be spending less throughout the rest of the year.
Home Depot’s results were a little better. Shares went up 5% before closing up 1.68% on Wednesday. The firm reported its strongest first quarter sales EVER. As opposed to Walmart who may not even grow by 1% in 2022, Home Depot are expecting revenues to grow 3% this year.
TJX, the parent company of TK Maxx, did much better. Shares were up 7% by the end of Wednesday. The results were a “positive standout” in the market, according to Citi analyst Paul Lejeuz and others like him. TJX forecasts they may beat expectations in 2022. Giving markets a glimmer of hope.
Musk’s ESG Headache
It’s hard to find a week when Elon Musk doesn’t dominate the headlines, or crypto for that matter. But after stalling on buying Twitter, the serial entrepreneur has a new headache. Tesla lost its spot on the S&P ESG Index this week:
As a result of the news, Tesla’s share price sunk by 6.8% on Wednesday to near a 2022 low. The S&P 500 ESG Index cited “lack of a low-carbon strategy” as the main reason. Musk is no longer voting Democrat, whom he blames for instigating the ESG agenda. Investors are displeased too. Tesla’s promise as a green innovator appear to be going up in ‘smoke’.
How did FAANG stocks perform?
Like each week we bring you news of the movements of the biggest stocks in the world.
Apple, Microsoft, Alphabet (Google’s parent company), Meta (Facebook’s parent company), Amazon and Tesla are all down this week again. Apple is down over 6%, Microsoft 3%, Alphabet almost 5%, Amazon just over 5% and Meta by 3.7%. A dismal performance by the Tech Giants, with Tesla dropping almost 8% as well this week [correct at time of publishing 13.30 GMT].
Some companies have performed better like Citi, ExxonMobil or PayPal. But Walmart is down almost 20% this week, a disaster for the U.S. retail giant. Costco, another retailer, is also down almost 15%.
With inflation continuously rising, opportunities for retail investors to hedge their bets are limited. Could it be a good time to buy? Analysts looking at Tesla on TradingView are of mixed opinions. Might be better to see what next week brings.
Author: Andy Samu
#Tesla #FAANG #Coinbase #TerraUSD #TradingTrends #Robinhood #Walmart #HomeDepot #TJX #DigitalAssets #ElonMusk #USConsumerConfidence
This Article is most definitely not Financial Advice.
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