From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
MARKETS AND BONDS
A year ago this week, the market ended its longest expansion in history. The epic bull run in stocks that lasted from March 2009 until March 2020 collapsed just as it was becoming clear the extent to which the novel coronavirus had tightened its grip on the world. Exactly one year later, the Dow notched a new record high as Congress passed one of the largest economic aid packages ever, which President Joe Biden then signed into law. Still, there’s a sense of unease on the Street. Bond yields jumped to end the week — the 10-year is back up near its highest levels of the year — adding to growing concerns that rising rates could take the wind out of the sails of some of the growth stocks that have been on fire during the pandemic. Tech stocks have been under pressure for that reason, though the Nasdaq still had its best day in months on Tuesday as investors bought the dip. The tech-heavy index closed the week up 3.2 percent, while the S&P rose 2.47 percent.
VACCINE GAME-CHANGERS
The Johnson & Johnson COVID vaccine has been heralded as a game-changer. A single shot, no ultra-cold storage, and backed by J&J’s manufacturing might with an assist from rival Merck. Two weeks after the jab got the green light from the FDA, Europe’s top drug regulator followed suit, while the White House ordered another 100 million doses. J&J shares have been far less volatile than some of its vaccine competitors; while it has missed out on some of the huge upside that Moderna saw over the last year, it’s also much more stable on a trailing 12-month basis. Meanwhile, Novavax, a Maryland-based biotech company that was all but left for dead this time last year, reported phenomenal results from its own vaccine’s late-stage clinical trials. That two-dose shot could get FDA approval this spring. Novavax shares were trading around $10 when the pandemic was declared a year ago. Today, it’s at $200.
GAMING THE MARKET
The online gaming platform Roblox was the latest tech company to soar when it debuted on the public markets this week, taking the newly popular route of a direct listing. Shares closed up 43 percent on the first day of trading, giving the company a valuation of nearly $42 billion (up from $4 billion a year ago). If you’ve never heard of Roblox, that’s because you are neither a tween nor a parent of tweens. The platform is enormously popular with kids; more than half of its users are under 13. Roblox’s "secret sauce" is that it allows players to also be creators by building their own online games and universe, which they can then sell for either in-game currency or real money.
AMC OPTIMISM
AMC Entertainment is optimistic about the post-pandemic future. The largest U.S. movie-theater chain reported earnings showing an 88 percent drop in revenue year-over-year, but also noting that nearly 90 percent of its domestic locations are now open in some capacity. If restrictions continue to lift and attendance comes back as expected, the company says it has enough cash on hand now to meet its debt requirements and operational expenses for at least another year. Shares are up close to 100 percent over the last month and more than 275 percent over the last year.
GAMESTOP RIDE'S NOT OVER
GameStop saw some of its wildest price action since the halcyon days of the Reddit meme-stock short-squeeze of late January. Shares took off after the company disclosed that Ryan Cohen, the shaman-like founder of Chewy, would be tapped to lead its e-commerce transformation. Cohen acquired a minority stake in GameStop last year for about $80 million, ostensibly lighting the fuse on the original rally that shocked the Wall Street establishment. On Wednesday, GME actually briefly topped its record high, set back in Jan., but then just as quickly, the stock gave it all up — dropping by 40 percent in a matter of minutes and leading to several trading halts. Shares resumed their march higher and ended the week at $264.50.
