Hello readers,
It's been an eventful week in the stock market, with some ups and downs. Let's dive into the highlights.
The S&P 500 and Nasdaq both closed the week on a positive note, with gains of 0.2% and 1.2% respectively. However, the Dow Jones Industrial Average was dragged down by Nike, whose share price took a tumble of nearly 12%. Nike recently announced a cut in its outlook for the fiscal year, but they have plans to cope with softening demand through cost-cutting measures and product improvements.
On the other hand, U.S. videogame stocks surprised everyone by performing well, despite a sharp selloff in their Asian counterparts. Chinese regulators proposed restrictions on incentives that videogame makers typically use to drive player engagement and in-game spending. This led to a 13% and 25% loss in the value of Tencent and Netease stocks respectively. However, Take-Two and Roblox made gains, and Electronic Arts only slipped 0.2% thanks to their limited revenue generation in China.
Looking ahead, there are some interesting developments to keep an eye on. Goldman Sachs Research forecasts that the U.S. GDP will grow by 2.1% in 2024, outperforming expectations. This suggests a low recession risk for the U.S., as inflation cools and employment remains strong. Additionally, there is speculation about the future of bitcoin. After a significant increase in price in 2023, some are wondering if the market will sell on the news in 2024.
Lastly, it's important to note that the bond market is facing some uncertainties. Long-term Treasury yields are currently low, but there are reasons to believe they could go even lower if inflation continues to cool.
That's all for this week's market update. Stay tuned for more exciting news and trends in the world of stocks.
Best regards,
Daniel Silva
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