Alchanati Campbell & Associates
Techies bring down Wall Street, Brits flying non-stop to Australia, Kim Jong Un travels abroad, and Spotify is a hero.
Tech leads late selloff. Facebook and Alphabet lead the selloff with declines of 4.9% and 4.47% respectively. Tech companies have been under pressure recently with concerns of government regulation and privacy questions surrounding Facebook. Facebook’s CEO Mark Zuckerberg agreed to testify in front of Congress. Year-to-date, Facebook is down 14% and lost close to $80 billion in market value. At closing, Dow Jones down 344 points (-1.43%), the S&P 500 down 45 points (-1.73%), and the Nasdaq down 211 points (-2.93%).
GlaxoSmithKline Plc agreed to buy out Novartis AG stake. GlaxoSmithKline will buy out Novartis’ 36.5% stake in its consumer healthcare unit for $13 billion. Novartis invested in Glaxo’s consumer health unit in 2014 and the original deal allowed Novartis the right to require Glaxo to buy out Novartis’ stake in the business.
Anti-crypto Twitter. Twitter banned ads of ICOs (Initial Coin Offerings) today. Bitcoin fell below $8,000. A growing number of companies are starting to ban cryptocurrency advertising on their platforms. They fear damage to their reputation if their users are left penniless after buying into one of these risky, unregulated ICOs. Alphabet and Facebook banned the advertising early this year.
Qantas Flight 9. The first scheduled non-stop flight between London and Australia touched down in Heathrow Airport Sunday. In 1947, it took 4 days and 7 stops to travel from Australia to the UK. Now, the 9,009 mile journey is completed in just over 17 hours.
What a surprise! Kim Jong Un gave a surprise visit to Beijing early this week. China is North Korea’s biggest military ally, trading partner, and economic partner. This was Kim Jong Un’s first trip outside of the isolated country of North Korea since taking power in 2011. The train used for his travels is reported to be 21 cars long, bulletproof, and more powerful than a speeding bullet, but with a top speed of less than 40 mph because of its weight.
The savor of the music industry. Spotify Technology SA was founded in 2006 for the purpose of ridding the piracy problem from the music business. Spotify is a music streaming service that gives their users access to 35 million songs, podcasts, and other media. The creation of Spotify saved the music industry and the total global sales of music have grown 3 straight years after a 15 year decline. The company is valued at more than $20 billion, but it does not make any money. With music-rights holders taking $.75 on every dollar, Spotify is having a hard time becoming profitable. Spotify is going public in the beginning of April with a conventional IPO (issued stock beforehand to raise funds and letting existing investors to sell their shares directly to the public).
Hate it or love it. The US Treasury has begun to auction off approximately $300 million worth of bill and notes. This debt financing will be used to fund President Trump’s $1.3 trillion budget and it will be also used to help relieve some of the pressure put on by the tax cuts this past December. The yield for the 10-year T-bond fell again today. This is a result from investors moving towards safer investments as the stock market strayed into red again. As investors move into bonds, the price of bonds increase and as the price increases, the yield falls.
For people who like sports. A tragedy happened last night. The Los Angeles Lakers are officially eliminated from the playoff contention. Last night’s loss against the Detroit Pistons put the Lakers at 32-41 for the season. With nine games left, the youngsters have to go undefeated if they want to finish with an even record. Around the league, there's a really good prime time game tonight: Lebron and the Cavs are in South Beach to face Wade and the Heat who currently sit at the eighth seed. But with everyone's record so close in those last three spots (6th, 7th, and 8th seed), we might finally get a Cavs/Heat playoff series. We will keep you posted.
The Alchanati Campbell and Associates Team
WHAT'S UP FRIDAY? is a weekly newsletter that will give you a summary of "What's up?" on Wall Street, in the US and around the World written by The Alchanati Campbell and Associates Team. What makes us unique is we focus on long-term knowledge; knowledge that will still be useful to you 10 years from now.