Stock Market review
US
It wasn’t a great week for the US stock market with all major indices posting weekly declines as Investors weighed President-elect Joe Biden’s 1.9 trillion stimulus package as well as record levels of coronavirus infections which have meant that America accounts for a 1/4 of all Covid deaths.
Weekly Returns:
S&P 500: Down 1.5%
Dow: Down 0.9%
Nasdaq: Down 1.5%
Want to know what each index is? You can find out here
Europe
Europe ended the weekly lower as concerns over new lockdown measures, political uncertainty and a re-emergence of Covid-19 cases in China dented the positive sentiment created by President-elect Joe Biden’s stimulus plan.
Weekly Returns:
FTSE 100: Down 2%
DAX: Down 0.91%
Stoxx 600: Down 0.8%
Stocks to watch
Jumia Technologies, stock price: $43.50
An e-commerce company focused in Africa, Jumia is a company which has the ability to thrive in what will be an exploding market in the next decade. With Africa being a continent of 1.216 billion people and an ever-growing middle class and increasing incomes, Jumia is well-positioned as a market leader in African e-commerce to take advantage of the this potentially valuable and little penetrated market. In addition, the company has created Jumia pay which is an internet payment platform. With the overall payment market across Africa set to reach 650-750 million customers and a transaction volume of $14-20bn by 2025, this provides another avenue of strong revenue growth.
Disclaimer: This is not investment advice and should not be considered as such. This is merely my opinion on stocks which have interested me.
Finance
Joe Biden has released his $1.9 Trillion stimulus plan which plans to give Americans a $1,400 stimulus check among others in a plan to get the economy recovering again.
What is involved?
Joe Biden announced part 1 of his ‘American rescue plan’ to revitalise the American economy. In his proposal was to increase federal unemployment benefit to $400 and extending it through to the end of September. Also included was rising the minimum wage to $15 per hour, provide $350 billion in state and local government aid, $50 Billion towards covid-19 testing and $170 billion for k-12 schools and higher education institutions. Joe Biden also announced a part 2 in February where he is expected to release a second bill focused on longer-term goals of creating jobs, reforming infrastructure and combating climate change.
Twitter lost $5 billion in stock value as it removed permanently suspended Donald Trump from its platform.
Analysts expect as much as $500bn of green bonds in bumper 2021 as policymakers seek a sustainable recovery from the coronavirus crisis
Mortgage refinance demand has spiked 20% as borrowers fear missing out on record-low rates.
Analysts are expecting American companies to reveal a 9% fall in average profits compared to the same time the year before.
The U.S. government ran up a budget deficit of $144 billion in December and the gap is likely to grow even higher in the next few months after Washington approved more federal aid for the economy.
UK economy shrank by 2.6% in November as England was placed in lockdown for a second time, official figures show.
Politics
Donald Trump has become the first president to be impeached twice in one term.
What happened?
Congress voted to impeach Trump on Wednesdays after the events last week in the capital. What is interesting is that Republican senate majority leader McConnell signalled he was in favour of impeachment, showing how the tide has turned against the president. Prior to the vote, President Trump warned that voting to impeach him would cause ‘tremendous anger’. This vote also comes after significant political pressure for Trump to resign with Biden, House leader Pelosi and Senate minority leader Chuck Schumer. The Senate is unlikely however to confirm the impeachment, preferring to let Trump finish his term before moving on.
The FBI has warned of possible armed protests across the US as Trump supporters and far-right groups call for demonstrations before Joe Biden is sworn in as president.
The company at the centre of an outcry over the size of food parcels going to the poorest pupils while schools are in lockdown in England has apologised.
Foreign secretary Dominic Raab has said some restrictions could go by March and the vaccine should be offered to every adult by September.
Technology
It has been found out that a man has two guesses to unlock a Bitcoin wallet with $240 million worth of Bitcoin in it.
Messaging platforms Signal and Telegram have both seen a huge surge in downloads around the world following a controversial update to WhatsApp's terms and conditions.
The fall out from the pro-trump insurrection has seen Trump banned from YouTube, while a slew of tech firms including Google and apple take Parler off their platforms.
In a year which saw most stocks fall and struggle to recover, tech stocks soared as Tech companies added $3.4 trillion in value in 2020.
Weekly Portfolio review
Trial Portfolio Holdings: Slack, Snap, Peloton, Docusign, Teladoc, NIO, Shopify
Week 2 of my portfolio was overall a negative one with all but one stock securing weekly declines. This was due to a wider market drawback after last week’s strong uptick where most stocks saw strong growth as a result of Biden’s confirmation. With earnings season now upon us, it will be interesting to see how these stocks perform in the upcoming weeks with coronavirus undoubtedly going to impact earnings and revenue growth.
Portfolio Returns:
Week 1: 8.77%
Week 2: -1.95%
STD (start to date): 6.65%
Biggest Gainer: Docusign - 1.93%,
Biggest Loser: NIO inc - (-)4.98%
Podcasts
This week’s podcast looks at the eagerly awaited career insight series episode on private equity. We welcomed Tobi Osi - a former Goldman Sachs banker and current private equity associate - on to the podcast where we demystify the industry by explaining its role in the financial services system. We also touched on many issues such as the routes into this niche industry, diversity in private equity and the skills needed to flourish in this role.
You can access the podcast with this link:
Stat of the week
$1 trillion - (Sorry another 1 trillion stat!) This was the total value of cryptocurrencies as Bitcoin soared past $37,000 last week (with Bitcoin account for around $750 billion). A significant dip since has seen Bitcoin market cap sit around $728 billion
Quote of the week
“Man is affected not by events but by the view he takes of them” - Seneca
Mindset and Perspective. These are two things which are key to progress which everyone should take on board. How we react to situations is arguably always more important than the situation themselves. When you have a positive mindset, you will always have a positive perspective and try and learn from difficult situations rather than sulking or giving up. This week let us try and take a positive perspective to all situations we occur, no matter how bad they may be.
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