GME Stock – Stocks Are Rising, Along With Oil Prices
Stocks were mixed as interest rates moved decisively higher, dragging down shares of high-growth tech companies.
The yield on 10-year Treasury debt jumped to 1.68% from 1.62%, a sign that investors are confident that inflation and economic demand will firm. That sentiment was lifting many stocks Friday.
But such a sharp move higher in long-dated interest rates is a marked negative for the valuations of growth companies—many of which are in the tech space—because higher rates reduce the present value of future earnings. The bulk of growth companies’ earnings are expected years from now.
In Asia, China’s CSI 300 index gained 2.2% and the
Nikkei 225 index
rose 1.5%. A Reuters report that China smartphone maker
will use automobile maker
Great Wall Motor
‘s factories to make electric vehicles sent those shares up 6% and 10% respectively.
And shares of global shipping companies such as Korea Line and A.P. Moeller-Maersk were getting a lift amid continued efforts to dislodge a huge vessel stuck blocking traffic in the crucial Suez Canal waterway. Officials cautioned that traffic could be jammed for days.
“What’s important is how that might affect global trade and the fact it is already causing shipping rates to rise, which in turn could fuel inflation as extra costs are passed on to the consumer,” said Russ Mould, investment director at AJ Bell, in a note to clients.
“This all suggests we remain at a fragile point for markets and one that could lead to heightened volatility,” he added.
Energy prices were also rising, with U.S. and Brent crude futures up around 2% each.
Stoxx Europe 600 index
climbed 0.6% and was poised for its best one-day percentage gain in a week, with resource names such as
leading the way higher.
Inspiration for global stocks stemmed from Thursday’s upbeat Wall Street session, after economic data showed jobless claims at the lowest level of the Covid-19 pandemic. Investors were also optimistic after President
announced a new vaccination goal of 200 million shots in the first 100 days of his presidency.
Among stocks to watch, shares of
(ticker: GME) were climbing in premarket. Stock in the videogames retailer soared on Thursday, helped in part by demand from retail traders.
Flexible office space group WeWork has agreed to merge with special-purpose acquisition company
in a deal valuing WeWork at $9 billion, including debt, The Wall Street Journal reported on Friday. Shares of BowX rose 4%.
Zoom Video Communications
(ZM) was down more than 1% amid the selling in tech. Deutsche Bank initiated coverage with a Hold rating.
(MO) shares were up 1.2% after Jefferies upgraded the stock to Buy from Hold.
(LITE) shares rose more than 2%. Raymond James upgraded the stock to Strong Buy from Outperform.
(OLN) saw shares rise almost 4% after RBC Capital Markets upgraded the stock to Outperform from Sector Perform.
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