🍨 Daily Scoop: Let’s copy them again

By Hoda Mehr Fri, Jul 19, 2019

What you need to know?

While Thursday turned out to be a good day for the overall stock market, the interest rate chatter is emerging again. Investors are starting to worry about good economic news and indicators. For example, the Federal Reserve Bank of Philadelphia released its monthly manufacturing business outlook, and things are very positive. According to the report, the current new orders index grew 11 points, while the shipments index rose 8 points. And, investors are getting impatient about the consequences of such good news.

What does it mean for investors?

As is the case these days, an excellent economic indicator is not that welcomed by analysts and the media. People are worried that good indicators change The Fed’s decision, and they may conclude that the economy doesn’t need an interest rate cut. This monthly report is certainly not helping the case for an interest rate cut at the end of July.

• U.S. markets: The stock market regained some of its losses on Thursday, and all three major indices finished the day in the green zone. Scroll to the Overall Market section to read more about what happened. 
• Cryptocurrency: Bitcoin price is back to above 10,000 per coin. Apparently, the price decline was partially due to the miners themselves. When Bitcoin price rises, miners start selling their coins to “hedge’ their risk, and some of the market fluctuations are just created by the miners. What a fascinating market!

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What happened on Thursday?

After a few days of decline, investors wrapped up Thursday happier than how they started it. The S&P 500, the Dow, and the Nasdaq all regained their momentum. The upward push came from more than 1% gain in the Financial Services and Technology sectors. It also didn’t hurt to hear from New York Fed President John Williams, who talked about the need for an interest rate cut to insure the economy against the trade war.

Now What?

All eyes are on the 2-day meeting at the end of July. Investors can’t wait to see what the Feds have decided about the interest rate. From the looks of it, investors are hopeful, and the signs are more on the rate cut side. If the rate cut doesn’t happen, investors will be extremely disappointed.

Back off Trade War. 

Shares of Skechers USA Inc (Ticker: SKX) had a tremendous after-hours trading session and grew more than 11%. For several quarters, investors dismissed the company’s undervalued share price. However, the markets’ discouragement didn’t stop the Sketchers from putting up great results. In its latest quarterly earnings, the company announced revenue growth across all regions, including the U.S. It is a rare American business that is not impacted by the U.S. – China trade war and has even grown nicely in China.

Even good results were not enough. 

Shares of UnitedHealth Group Inc (Ticker: UNH) wrapped up Thursday lower than where it started the day by more than 2%. The price decline, surprisingly, came after higher than expected results by America’s largest health insurer. The decrease in the share price is because of investors’ fears of the uncertainties that are expected in the health care sector. Several state attorneys are questioning the constitutionality of the Affordable Care Act, and President Trump is looking to change the drug prices. The uncertainties masked the company’s excellent performance and sent the stock price lower.

If it’s free, you are the product. So, what happened?

Yesterday, we were wrapping up a jam-packed day of news and investing that we heard someone giggling rather childishly in the lobby. And guess who we found there? One of our board members was still sitting on the couch, almost an hour after he was supposed to leave the office. He was playing with the infamous FaceApp.

Apparently, it’s not only our board member that is having fun seeing how similar to his Dad he will look like in 20 years. Millions of people in the U.S. have downloaded and shared their pictures with the App. And, that has got the U.S. officials worried. It’s an artificial intelligence wonder that is playing around with your photos, and in the process, it gets you to accept too many uncomfortable terms and privacy conditions.

In the end, according to NPR, there is not much to worry about this specific company, but the concern is still valid. Whenever you are giving something of yours to a company or an App, especially for free, pause for a second and ask what you are giving away if you are not paying for this service. There is an old wisdom that applies to this situation very well:

“If it’s free, you are the product.”

Disclosure: Authors of this Scoop own shares of Skechers USA Inc (Ticker: SKX). 

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