An early Happy Valentines Day! After treading water as January came to a close, stocks returned to their winning ways last week. Equities rallied on the heels of strong earnings, continued vaccination rollouts, and ever-present stimulus hope. However, the market story that caught all the headlines was the rapid rise and fall of the shares of video game retailer Gamestop. On the corporate earnings side of things, large technology companies such as Alphabet and Amazon demonstrated that they’re still at the top of their game as they beat earnings expectations. However, Amazon announced that visionary leader Jeff Bezos will step down from his role as CEO but stay on as the company’s as executive chairman. Wall Street is still trying to digest what this may mean for the company going forward. Regarding vaccinations, the U.S. hit a notable milestone this week: More Americans (26.5 million) have now received at least one COVID-19 vaccine dose than have tested positive (26.3 million). The U.S. has been administering vaccinations at a quicker rate than any other nation, at approximately 1.34 million doses per day. These are encouraging signs as the country continues to work toward ending the pandemic. The Gamestop news seemed like a classic underdog tale, as retail investors, many members of a Reddit discussion forum, drove up its share price in order to damage some hedge funds that had been betting the share price would fall. At one point, Gamestop shares were up over 1700% this year. However, what goes up must come down; since its peak, Gamestop shares have lost over three-quarters of their value. While Gamestop may feel like a David and Goliath story for those who were able to profit, for others, particularly those who entered near the top of the market, it is more of a cautionary tale that reveals how truly difficult it is to time the market—much less an individual stock. Generally speaking, investors are best served by focusing on the opportunity for long-term returns and staying diversified. Stay safe and be well. Let me know if I can help your other loved-ones, I always commit to helping introductions from my existing clients! Have V-Day, Prez Day, and Mid-winter break, for those that get one! Bryan and Lisa, your advisory team 425-774-9053 (x109, or Lisa x131) Market comments are based on indexes which are unmanaged and cannot be directly invested into. Past performance is no guarantee of future results. Investing involves risk and the potential to lose principal. The information provided, including references to individual companies are for general informational and educational purposes only and is not a recommendation of any kind or investment advice. Diversification is an investment strategy that can help manage risk within your portfolio, but it does not guarantee profits or protect against loss in declining markets. Forward-looking statements are subject to numerous assumptions, risks, and uncertainties, which change over time and cannot be guaranteed. |
Hendrickson's February Market Update
