A big surge for Robinhood stock.
Today is Thursday, August 5, 2021.
Robinhood Achieves Meme Stock Status With Surge
One week after its public markets debut, investing stock Robinhood (Nasdaq: HOOD) surged as high as $85 per share on Wednesday before closing at $46.80. That’s a one-day increase of 50% and a weekly gain of 90%.
Interesting: Shares of Robinhood were halted several times Wednesday morning because of volatility.
Rewind: Robinhood’s stock had a lackluster debut last week as the shares declined below the IPO price. Things changed for the stock after high-profile fund manager Cathie Wood backed it a few days later.
Meta-Meme Stock: There was no clear business reason for Wednesday’s price surge. While some may say it's retail investors driving the price of Robinhood (similar to other meme stocks), it’s unlikely that this is the case. Robinhood has a market cap that is five times the size of GameStop, (NYSE: GME), the poster child for meme stocks. Retail investors aren’t the only reason behind the surge.
Possible Causes: Reasons for the price increase include investors covering shorts or possibly options trading. But there’s no definitive reason at this point.
Final Thoughts: Robinhood had strong revenue last year, but if Wednesday was any indication, there’s a lot of volatility here.
Notable Earnings Today: Beyond Meat (Nasdaq: BYND), ViacomCBS (Nasdaq: VIAC), Kellogg’s (NYSE: K), Moderna (Nasdaq: MRNA), Dropbox (Nasdaq: DBX)
Notable IPOs Today: European Wax Center, Inc. (Nasdaq: EWCZ), WCG Clinical, Inc. (Nasdaq: WCGC), Cadre Holdings, Inc. (NYSE: CDRE), Weber Inc. (NYSE: WEBR)
Notable Equity Crowdfunding Campaigns Ending Today: Commissary Club (Republic), Arlene (Republic)
NFT Stocks For Retail Investors
As more public and private companies chase virtual reality, there’s also a clear link between the metaverse, which is a technical term meaning the sum of experiences in the digital and virtual worlds, and non-fungible tokens (NFTs).
Definition: An NFT is effectively a unique digital asset that represents real-world assets, including collectibles, art, music and videos.
Bubble or Opportunity: More people have invested in NFTs in 2021. Some may call it a bubble, but the technology could introduce more people to the concept of the metaverse.
Data: The global metaverse market is expected to increase from $46 billion to $280 billion by 2025, according to Strategy Analytics.
Stocks To Invest In: If you really believe in NFTs, here are some stocks that are dipping their toes into NFTs: DraftKings (Nasdaq: DKNG), Dolphin Entertainment (Nasdaq: DLPN), Mattel (Nasdaq: MAT).
Ethereum Price Spikes Before Thursday Upgrade
An upgrade to the Ethereum network, known as Ethereum Improvement Protocol 1559, that is scheduled to occur on Thursday could result in the “burning” of the cryptocurrency of the network.
Reasoning: The network upgrade, which is also being referred to as the “London hard fork,” is being done to change the way that transactions of Ethereum are processed so that transaction fees are more predictable.
On Fire: The “burning” refers to a reduction of tokens on the network.
Numbers: In anticipation of the upgrade, the price of Ethereum has shot up by more than 6% on Wednesday to its highest value in more than a month.
Outlook: Analyst Alex Kruger told CoinDesk that the upgrade itself is “overrated” and what happens after the upgrade is more important.
Final Thoughts: While there won’t be much of an impact immediately, long-term the reduction in the supply of Ethereum could be beneficial for investors.
Trends To Watch
In Need Of Car Repair: General Motors misses Wall Street second-quarter earnings expectations, raises 2021 guidance (CNBC)
Not So Fast: Fastly stock plummets after earnings again; June outage said to have lasting effects (MarketWatch)
That’s So Crude: Oil falls on U.S. crude stock build, Delta variant spread (Reuters)
Driving Down: Uber shares fall despite revenue beat as its core operations continue to lose money (TechCrunch)
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