What you need to know?
Scoopers, the earnings results are quieting down, but trade war fears rage on. Except for a few upward movers (hello Gold), most stocks lost a little bit of their value. Political unease from across the world is the main reason for the stock market’s bad day on Monday. In this edition of The Daily Scoop, we’ve covered those stories and we even have the news about the possibility of the aliens passing by our galaxy.
Scroll down to the “Overall Market,” “What’s up?” “What’s down?” and the “Water Cooler” sections to learn more.
- U.S. markets: All three indices lost at least 1% of their value on Monday. The Dow led the pack by dropping ~1.5% on the first day of the week. Scroll to the Overall Market section to learn more.
- Cryptocurrency: Bitcoin’s price stayed under the $12,000 mark as the SEC delayed the approval of three Bitcoin ETFs.
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What happened on Monday?
The market is walking on shaky ground. Most of the unease is politically charged. Here are a few highlights of the things that worry the investors:
- Because of the trade war concerns, Bank of America predicted a 30% chance of a recession in the next 12 months.
- China is broadcasting its strength by showing off its military forces at the Hong Kong borders.
- Investors who look for safe bets are taking money away from the bond market.
- The political unrest in Argentina and the Brexit saga do not help the situation either.
What does that mean?
It helps to remind ourselves that the market is in its 11th year of historical recovery. It’s not the end of the world if the market falls. The cycles are normal parts of the economy. From an investing point of view, a recession is the best opportunity to invest in the stock market. You won’t be able to predict when a recession comes, but you can prepare yourself for one. Keeping cash on the side and avoiding overreactions are some of the things you can do to go through the recession if it comes.
Gold had a good Monday.
So, what happened?
Forget companies with good earnings. Gold is trading at its 6-year high, and gold-based ETFs are seeing some of the highest prices they have had in quite a while. Investors are worried about the recession, and buying up gold-based ETFs and gold-miner companies’ ETFs.
One thing investors are forgetting is that the price of gold is not the only factor in determining a gold-mining company’s value. Many of the companies in the sector suffer from operational challenges. You still need to do your research and consider how a gold-mining company operates before pouring money into it. When fear becomes widespread, investors forget some of the basics of investing.
This company had a bad Monday.
Uber (Ticker: UBER) hit a new all-time low. Shares of the company fell more than 6% on Monday. Apparently, the company announced a hiring-freeze on Friday evening and canceling pre-scheduled interviews for engineering roles. With billions of dollars in losses, investors are questioning the company’s ability ever to turn any profit.
Rival company Lyft (Ticker: LYFT) didn’t have much better Monday. Shares lost more than 5% on Monday due to similar concerns.
Aliens are coming!
So, what happened?
From when we were little kids, they told us that black holes are black. Pitch, dark, black! Right? Not anymore.
The black hole that sits at the heart of our galaxy suddenly became 75 times more luminescent for a while, and then went back to normal. It’s so unusual that scientists at UCLA assumed they’ve made a mistake, at first.
At this point, no one knows why. We bet that an alien ship just swooshed through it. If you have any better guesses, let us know by replying back to this email.
The reason we told you this story is to remind you that bigger things are happening in the world that is more important than the stock market dropping 1%. Cheer up!