The Economic Boom
By Tue, Jun 29, 2021
Hey Scoopers,
As another week started, the stock market changed focus to the June jobs report on Friday. — More on that in the “Overall Market” section.
Beyond the overall market, an EV maker surprised journalists and investors with an invite for its third-anniversary celebration event. Meanwhile, an airline company will have to postpone international flights. — More on that in the “What’s Up?” and “What’s Down?” sections.
By the way, not everything is rosy in the U.S. booming economy. — 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 mostly in the green zone on Monday. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Bitcoin‘s price increased to $34K per coin.
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Busy Calendar
The stock market ended mostly in the green zone on Monday.
Taking advantage of the last week’s momentum, the S&P 500 index and the Nasdaq index kept pushing to higher records. Although President Biden’s infrastructure plan was the previous week’s highlight, the markets now turn attention to a busy economic calendar. Estimating an unemployment rate to decrease to 5.7%, investors are waiting for the June jobs report on Friday.
Unexpected Event
So, what happened?
Shares of NIO (Ticker: NIO) were up by more than 9% on Monday. Yesterday, China-based journalists received an invite from the EV maker to a special event. The company said it would hold an “NIO Power Day” in July. More than celebrating its third anniversary, investors expect NIO to present its new service, “NIO Power.” The service would include battery-swap stations, mobile charging cars, and more to assist NIO owners. The company believes the news perks would bring more customers in the future.
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Staying on the Ground
So what happened?
Shares of American Airlines (Ticker: AAL) were down by almost 4% on Monday. Although many investors expected international flights to return as vaccines rolled out, airliners were under pressure due to countries’ new restrictions to stop the Delta variant spread. To reduce losses and keep a cash inflow, American Airlines has focused on domestic flights. However, the company’s most lucrative tickets are the international ones. Therefore, American’s short-term financial status could be at risk.
The Downside of the Economic Boom
So what happened?
After more than a year since the COVID-19 pandemic started, the U.S. economy is growing at the fastest pace in the last 30 years. In 2021, the markets expect the country’s economy to grow by more than 6.5%. However, it is not all rosy. The economy’s reopening drove customers to experience a rapid increase in inflation, along with shortages in many sectors. Here are three things that worry investors about the status of the economy:
- Inflation: Gas, flights and used cars witnessed more than a 20% increase in prices.
- Labor shortages: Along with price inflation, the economy is facing a labor market shortage.
- The poor and rich economic gap: Furthermore, the U.S. economy’s booming recovery displayed how rich and developing countries are on even more radical diverging paths.
Although the pandemic is coming to an end soon, other problems won’t leave so easily.
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
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.
