Blindspot
By Fri, Oct 30, 2020
Hey Scoopers,
The best ever GDP growth rate in Q3 boosted the market out of Wednesday’s deep red. — More on that in the “Overall Market” section.
Beyond the overall market, investors saw a glimpse of good old days at a tech stock and sent the stock surging. Simultaneously, they ignored the key information released by another tech stock and let the stock price fall sharply. — More on that in the “What’s Up?” and “What’s Down?” sections.
Oh, by the way, it seems PlayStation has a blindspot. — More on that in the “Water Cooler” section.
But, first, here is a recap of what happened in the market yesterday:
Market Recap
- U.S. markets: Thursday turned to be the opposite of Wednesday for all three indices that finished the day in the green. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Bitcoin’s price stayed above the $13,000 level, but the excitement has started to subside after a few rally days.
Learn how to make more money trading stocks
Get 12 free stock market lessons delivered to your email from Investor’s Business Daily, the leader in investing education for over 35 years. We’ll cover the basics of better investing and show you how to give yourself an edge in the market.
Get Free Lesson
(By clicking you agree to receive email updates and special offers from Investor’s Business Daily)
Best Ever Q3
Thursday was a better day across the stock market, and all three indices recovered some of the losses they incurred on Wednesday. The boost came courtesy of the best ever Q3 GDP growth rate in the U.S.
A Glimpse Of Good Old Days
So, what happened?
Shares of Alphabet (Ticker: GOOG / GOOGL) were up by more than 11% on Thursday. The company announced its latest quarterly earnings, and investors saw a glimpse of the old Alphabet. The company returned to growth as digital advertising resumed. Investors celebrated the news by sending the stock up in the air.
The Elephant in the (5G) Room
Now is a time when it pays to heed timeless financial wisdom.
John Templeton, one of the world’s greatest investors, once said, “To buy when others are despondently selling and to sell when others are avidly buying requires the greatest of fortitude and pays the greatest ultimate rewards.”
Investors Missed It
So, what happened?
Shares of Twitter (Ticker: TWTR) were down by more than 8% on Thursday. The company announced its quarterly earnings report and missed its user growth target. As a result, the stock dropped from its recent record-high. Investors missed seeing the drastic increase in advertisements and the growth in “monetizable” daily active users. The fact about Twitter is that it can’t grow as rapidly as other social media due to its format, vibe, and content speed. However, the growth opportunity comes from the company’s ability to make money from its current base, and that’s what Twitter precisely did last quarter.
VR Blindspot
So what happened?
Virtual Reality (VR) in gaming is far from reality, says PlayStation’s CEO. We have heard so much about VR, even some other companies such as Facebook (Ticker: FB) are pouring money into VR. However, PlayStation’s CEO spoke about the upcoming PlayStation 5 release, and it seems it has decided to pause releasing new VR hardware.
The last time we heard something similar from Sony (Ticker: SNE), PlayStation’s parent company, was when it decided to stick to its Walkman (personal music players) and ignore the emergences of iPod and new music player devices.
Is ignoring VR yet again a new blindspot in Sony’s growth path, or the company is correct this time? If history is our guide, perhaps PlayStation has a VR blindspot. Time will tell! However, tech companies can’t miss a major trend in this day and age, and ignoring VR may become the blindspot that hurts PlayStation in a few years.
If you have any questions, or suggestions let us know by emailing us at members@tradestocks.com. We look forward to hearing from you.
About the Author
The authors of this Scoop are the editorial team at Stock Card, led by Hoda Mehr. Hoda Mehr is CEO and Co-founder of Stock Card and the host of Renegade Investors podcast. She runs a community of 40,000 stock market investors and manages Stock Card's successful flagship portfolio, Roll with Our CEO, on Stock Card Portfolio Store. Hoda is an Economist with an MBA from Concordia, John Molson School of Business. She applies behavioral economics, data journalism, and storytelling to all aspects of her work. Before starting Stock Card, Hoda worked as a strategy and insights lead at technology companies including Symantec, Aimia and Sony. Create a free account to do your stock market research easily and mistake-free: Stock Card Stock Card
