🍨 Daily Scoop: El Salvador’s New Currency | Trade Stocks

El Salvador’s New Currency

By Wed, Jun 16, 2021

Hey Scoopers,

After setting new record highs in the previous session, the stock market digested new data pointing to inflation. — More on that in the “Overall Market” section.

Beyond the overall market, an electric truck marker successfully calmed down its investors. Meanwhile, an energy company has a larger competitor joining the market. — More on that in the “What’s Up?” and “What’s Down?” sections.

By the way, El Salvador adopted Bitcoin. — 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: The stock market ended in the red zone on Thursday. Scroll down to the “Overall Market” section to read more.
  • Cryptocurrency: Bitcoin’s price stayed at $40K per coin.

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More Data

The stock market ended in the red zone on Tuesday.

After hitting new records high in the previous session, the markets retreaded back to lower levels. The Commerce Department’s May retail sales report showed the first drop in sales since February, indicating a lower consumption as the stimulus-boosted period ends. Furthermore, the Bureau of Labor Statistics expects a 6.6% increase in the producer price index. Both indicators reiterated investors’ concerns about a higher inflation rate.

Not That Bad

So, what happened?

Shares of Lordstown (Ticker: RIDE) were up by more than 7% on Thursday. After the executive board opened an investigation over its now-former CEO and CFO on Monday, the electric truck maker announced it still has money to keep operations until May 2022. Although the announcement calmed investors, Lordstown affirmed it would have a limited pickup production, leaving more uncertainties in the future. No wonder why the 11% stock price jump during the normal trading hours gradually faded down to 7% in the after-hours trading.

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Competition Ahead

So what happened?

Shares of Plug Power (Ticker: PLUG) were down by more than 4% on Thursday. The price drop came after General Motors (Ticker: GE) and Wabtec (Ticker: WAB) announced a partnership to develop locomotive batteries and hydrogen fuel cell systems. GM’s entrance into this space means a new significant competitor for Plug. Although the energy company has solid grounds, GM’s competition will not be easy for Plug.

El Salvador’s New Currency

So what happened?

El Salvador became the first country in history to approve Bitcoin as a legal currency. Although the Latin country uses the American dollar as its official currency, El Salvador’s President believes cryptocurrency adoption would improve financial inclusion among the 70% of residents who don’t have access to the essential services from traditional financial institutions. From now on, Salvadorian businesses will have to accept Bitcoin as payment. Moreover, Salvadorians would have the option of paying taxes with Bitcoin.

It seems that the first step to adopting cryptocurrency as a daily currency has been taken. This means a significant win for the overall adoption of cryptocurrencies globally.

If you have any questions, or suggestions let us know by emailing us at [email protected]. We look forward to hearing from you.

About the Author

Felipe Nebesnyj is an Economics student who is passionate about the stock market and investing in the market. Originally from Brazil, he is working and studying in the U.S. and started learning about and researching the stock market at 16. Before joining Stock Card, Felipe worked on multiple stock market research projects that gave him the necessary knowledge and confidence to put into his stock market analyst career at Stock Card. Last but not least, he is an excellent violinist and enjoys video games.