Weekly Market Recap

Published Jan. 09, 2022
GameStop's stock rises after the company enters the NFTs market.

WEEKLY MARKET SUMMARY

Dow Jones S&P 500 Nasdaq
36,231 (-0.25%)
4,677 (-2.12%)
14,935 (-5.06%)

GameStop’s stock rises after the company enters the NFTs market.

GameStop Corp. rose 7.3% on Friday, extending the roller coaster ride of video game stores into this year. Shares fell after the Wall Street Journal said that GameStop was going to start a new division. GameStop plans to develop a marketplace for non-fungible tokens and introduce cryptocurrency plans, a popular area for retail investors. The shares made even more money at the start of the day and stayed around $144.52. If you bought shares of the company during last year’s Reddit-fueled excitement, they’ve gone up more than 650 percent in the last year alone. However, the meme stock had a bumpy start until 2022. Shares of AMC Entertainment Holdings Inc. fell by more than 15 percent in the first week of this year. Even though GameStop’s share price rose on Friday, it lost 5.2 percent in a week. There have been a lot of moves made by company executives to try to get ahead of retailers. The new division is the last one. Although the company specialises in selling printed versions of games, many consumers choose to download and stream games over the Internet. GameStop was one of the many companies that were injured when the company was closed nationwide during the pandemic.

Investors are less optimistic about the economy in 2022 because of the pandemic and the looming rise in interest rates.

Oil prices are down 11 percent from their late-October highs, reflecting traders’ concerns about slowing fuel demand. Some investments, like those in smaller and faster-growing technology companies, have been flat for the majority of the last two months. The S&P 500 index hasn’t moved much in the last two months. It went down a lot because people were worried that it would be very vulnerable to tighter monetary policies. Wall Street forecasters expect the S&P 50 0 index to rise even more next year, but lower valuations, a growing economy, and low interest rates all play a role in why they think that will happen. Another thing that investors point out is that each new outbreak of COVID-19 has less of an impact on the economy because people have learned how to deal with the virus. People also think that inflation will go down this year. Some think that if COVID-19 cases rise, it will slow down inflation rather than speed it up, which means the Fed could hold off on raising interest rates if the economy is having a hard time.

It was a record number of cars sold in the fourth quarter, so Tesla’s stock rose.

On Sunday, Tesla said it sold 308,600 electric cars in the fourth quarter and 936,172 in the whole year of 2021, far more than expected. Full-year sales are up 87% from 2020, when the electric car company made its first annual profit from selling 499,647 cars. A lot of people think that Tesla will make 267,000 cars in the fourth quarter of 2021, and it will make 897,000 cars for the whole year. Company plans to start making Model Y crossovers at a new plant in Austin next year. It also wants to open a new factory in Germany by 2022.

The sales of corporate bonds are going to be slowed down.

Investors think that the spread of U.S. corporate debt will keep going down into 2022. A group of analysts from big banks like Citigroup, Bank of America, and Deutsche Bank say that this year, US businesses will issue about $1.3 trillion to $1.4 trillion in investment-grade bonds, which includes debt sold by banks. That’s roughly equivalent to last year’s $1.46 trillion, while still marking a drop from 2020’s record $1.86 trillion, according to Refintiv. Behind the expected stability are expectations that the Federal Reserve will start raising interest rates as soon as March in order to fight surprisingly high prices. People who want to get low interest rates for the rest of the year may want to borrow early in the year to do so. This could also slow down borrowing in later quarters. Others worry that the return of the COVID-19 pandemic or a downturn in the economy could make it more difficult to borrow money.

Funds want to bet on risky new businesses, so they rush to do so.

The last year, investors have told people to invest in businesses before they have staff or products, which has led to a big rise in funding for high-risk, early-stage startup categories that are getting money. Over the last decade, the startup sector has been getting more and more money. Most of the money went to late-stage private companies that had already tried out their business models. A lot of money was invested in so-called seed and early-stage businesses in the United States by December 15, 2021, when that date came. In 2020, PitchBook Data Inc. says that there will be 52 billion people living in the United States, up from 30 billion in 2016. It’s been well-received because there have been more venture capital funds coming in than going out. Average seed and early-stage company valuations in 2021 were $26 million, up from $16 million in 2020 and $13 million in 2016.

Every day, the U.S. sees more than 1 million new COVID cases.

In the United States, there are more COVID cases each day than ever before, with more than one million new infections each day. As of Monday, Johns Hopkins University said there were 1,082,549 new cases of the virus. This is because the highly contagious variants of Omicron keep spreading across the country. The number of cases in the United States since the start of the pandemic has now reached 56,189,547. The virus has killed at least 827,748 people across the country. Having a record number of people show up on one day may be because there was a delay in reporting on the weekend of holidays. Many states in the United States don’t report data on New Year’s Eve, December 31, and many states don’t report data over the weekend. That is, some of these cases may be because of tests that came back positive before, so this may be the case. The number of new cases in the United States on January 3 was 480,273, which was more than any other country that Johns Hopkins tracked.

ADP shows that U.S. businesses added a lot of jobs last month, which is a good sign.

US businesses hired more than 800,000 more workers last month than the ADP report had predicted. This is more than double the number of people who were thought to have been hired. The November total has been revised downward from the originally reported 534,000. A weekly unemployment claim report will be released on Thursday, and a monthly report for December will be released the next day. Before the two-day meeting in January later this month, the Federal Reserve will pay close attention to these numbers. Released December minutes: Wednesday at 2:00 pm, the FOMC released the minutes of its December meeting, announced plans to speed up the cuts in bond purchases, and said there will be three rate increases in 2022.

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