What A Twist
By Thu, Jul 23, 2020
Hey Scoopers,
The U.S.-China conflict got a COVID-19 twist, and the market doesn’t know what to make of it. — More on that in the “Overall Market” section.
Beyond the overall market, one company keeps growing against all the odds, while another company is sliding despite all the great features and contents it has managed to cramp in one quarter. — More on that in the “What’s Up?” and “What’s Down?” sections.
Oh, by the way, Tesla here, Tesla there, Tesla everywhere. — 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: Stock market indices ended the day in the green but only slightly. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Bitcoin’s price inching up toward $9,500 as analysts believe a new rally has begun. One reason could be the new regulation that grants banks to custody a crypto account.
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A New Twist In The U.S.-China Conflict
Like Tuesday, the stock market indices didn’t move too much on Wednesday. The hesitation could be due to the news that the U.S. officials believe China’s consulate in Houston has been involved in hacking the U.S. entities in search of COVID-19 vaccine documents. The order was for China to close the consulate, and the response was the burning of documents. This is a new escalation of the conflict between the U.S. and China, with a COVID-19 twist.
Growing Against All The Odds
So, what happened?
Shares of Advanced Micro Devices (Ticker: AMD) were up more than 8% on Wednesday. The company announced a new desktop computer processor for commercial and consumer use. AMD is a chipmaker fighting against industry giants, and that has always played to its detriment. People assume the company cannot compete with the likes of NVIDIA (Ticker: NVDA) and Intel (Ticker: INTC). However, it has managed to grow year-after-year and now has a strong balance sheet to support its growth even though it is an extremely overvalued stock based on classic financial metrics such as price to earnings ratio.
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Cool R&D Doesn’t Cut It
So, what happened?
Shares of Snap (Ticker: SNAP) continued to fall for the second day in a row. As we discussed on Wednesday, the company announced its quarterly earnings report. Despite a 17% surge in the users and revenue, the larger-than-expected costs and misses on operating margin cost the company in investor confidence.
No matter how many amazing new features, Augmented Reality technology and content partners the company manages to cramp in one quarter, people are worried that Snap is becoming the R&D lab for the likes of Facebook (Ticker: FB) who just copy the cool stuff and reap the benefits.
Tesla Here, Tesla There, Tesla Everywhere…
So what happened?
We all know how overvalued Tesla (Ticker: TSLA) is. The car manufacturers are sporting a valuation higher than most other car manufacturers despite its almost negligible production compared to others. However, you’ve got to give the company credit. It says no to an opportunity.
A few weeks ago, someone on twitter asked for a smaller Tesla for European cities, and now, a Tesla factory is popping up in Berlin.
The other day, Texas offered tax credits, and guess what, there is a plan for a new factory in Texas.
Tesla is here, Tesla is there, and Tesla is everywhere.
Our email address is members@tradestocks.com. Let us know if you are still holding your Tesla stocks, after the recent spike. Also, feedback and questions are welcomed, as always.
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
