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Amazon: The e-commerce behemoth reported quarterly earnings after the bell on Thursday, with revenues that were 25% higher than the same period last year. While that's pretty impressive in its own right, the percentage wasn't high enough to match analyst expectations. Amazon (AMZN) finished the quarter with $113B in revenue, compared to consensus estimates of $115B, prompting shares to slump 7% in AH trading. The company also said it would continue to see difficult comparisons to the pandemic quarters of 2020, meaning the era of the company's bumper results may be slowing. 
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Trending
Corporate America made some moves after fresh guidance from the CDC that recommended fully vaccinated people and kids should wear face coverings indoors (in areas with substantial and high levels of COVID-19 transmission). Twitter (NYSE:TWTR) closed its offices in New York and San Francisco, just two weeks after the social media firm reopened in both cities. Facebook (NASDAQ:FB) is separately requiring its U.S. workers that return to the office to be vaccinated and Google (GOOG, GOOGL) also jumped aboard that train.
Over in Hollywood: Netflix (NASDAQ:NFLX) became the first major studio to introduce a blanket policy mandating vaccinations for the casts of all of its U.S. productions. The requirement will also cover any crews that come into contact with them, which are known as "Zone A" workers. All staff in that category will be required to show proof of vaccination, with few policy exemptions like medical, religious and age reasons.
The news arrived before President Biden announced that all civilian federal workers will need to be vaccinated against COVID-19 or face regular testing, social distancing, mask requirements and travel limits. The decision covers 2.18M civilian employees (and possibly another 570K USPS workers). Meanwhile, Apple (NASDAQ:AAPL) re-instituted a mask mandate at most of its U.S. retail stores, while Disney's (NYSE:DIS) domestic theme parks required all parkgoers to wear masks indoors starting Friday.
Analyst commentary: The Delta variant is a tougher investment risk to peg than inflation, declared macro strategist Jim Bianco. "You could see a big rotation away from the reopening stocks or can take a playbook out of last year and say 'If we get rising variant and we get restrictions, more stimulus money is coming.' And, what have we learned about stimulus money? It goes right into the brokerage account. It goes right into the stock market." (102 comments)
Over in Hollywood: Netflix (NASDAQ:NFLX) became the first major studio to introduce a blanket policy mandating vaccinations for the casts of all of its U.S. productions. The requirement will also cover any crews that come into contact with them, which are known as "Zone A" workers. All staff in that category will be required to show proof of vaccination, with few policy exemptions like medical, religious and age reasons.
The news arrived before President Biden announced that all civilian federal workers will need to be vaccinated against COVID-19 or face regular testing, social distancing, mask requirements and travel limits. The decision covers 2.18M civilian employees (and possibly another 570K USPS workers). Meanwhile, Apple (NASDAQ:AAPL) re-instituted a mask mandate at most of its U.S. retail stores, while Disney's (NYSE:DIS) domestic theme parks required all parkgoers to wear masks indoors starting Friday.
Analyst commentary: The Delta variant is a tougher investment risk to peg than inflation, declared macro strategist Jim Bianco. "You could see a big rotation away from the reopening stocks or can take a playbook out of last year and say 'If we get rising variant and we get restrictions, more stimulus money is coming.' And, what have we learned about stimulus money? It goes right into the brokerage account. It goes right into the stock market." (102 comments)
IPOs
It was set to be one of the year's most highly anticipated listings, but Robinhood Markets (HOOD) tumbled 8% in the worst debut ever for an IPO of its size. The stock trading app, which had surged in popularity among retail investors, priced its IPO at $38 on Wednesday - at the low end of a marketed range - suggesting it had to do more to convince investors to scoop up its stock. It also detailed plans to reserve up to 35% of shares for users of its app, who could make purchases at the IPO price through a new product called IPO Access.
Backdrop: Robinhood busted onto the brokerage scene back in 2013 with a mission to democratize the investing landscape. It has experienced tremendous growth in recent years and eventually prompted competitors like TD Ameritrade (NYSE:SCHW), Charles Schwab (SCHW) and E-Trade (NYSE:MS) to adopt its model of zero-commission trades. The coronavirus pandemic was also a boon for the app as homebound people turned to online trading, while a stampede of investors that have jumped into "meme stocks" and cryptocurrencies has continued to propel its popularity.
By the numbers: Selling 55M shares in the offering at a price of $38, Robinhood raised slightly over $2B (at a valuation of nearly $32B). Users have more than doubled to 18M over the 12 months through March, while revenue more than quadrupled over the same time period to $1.4B. However, meme-stock madness has led to big losses of late and the company agreed to pay $70M to settle a FINRA probe in June. Options trading accounts for about 38% of Robinhood's revenue, while equities and crypto are 25% and 17% of sales, respectively.
Advantages: Growth is off the charts and half of all brokerage accounts opened in the U.S. from 2016 to 2021 have been set up on Robinhood. The company is also hoping to expand into other initiatives, like IRAs and Roth IRAs, to help turn short-term investors into long-term ones. It could also offer other types of services like debit cards, credit cards, car loans and crypto wallets.
Risks: The app has been in the regulatory spotlight over gamification, which encourages users to trade more via rewards and celebratory notifications. Payment for order flow, the way Robinhood makes money, has additionally come under intense scrutiny, as it could create conflicts of interest and prevent investors from getting the best price for their trades. Retail investing could also slow and the Robinhood prospectus named seven U.S. state and federal bodies investigating the app.
The industry: 2021 hasn't been a good year for big IPOs in the U.S. Among companies that have raised more than $2B - including AppLovin (APP), Bumble (BMBL), Coupang (CPNG), DiDi (DIDI), Playtika (PLTK) and Shoals (SHLS) - all are down by double digit percentages since their first close. The Renaissance IPO ETF (NYSEARCA:IPO) is also off 19% from its February highs and down more than 5% YTD. That could signal that the market is having a harder time digesting bigger deals - amid a glut of massive equity issuances - and may deter investors from buying more IPOs if they are already underwater. (38 comments)
Backdrop: Robinhood busted onto the brokerage scene back in 2013 with a mission to democratize the investing landscape. It has experienced tremendous growth in recent years and eventually prompted competitors like TD Ameritrade (NYSE:SCHW), Charles Schwab (SCHW) and E-Trade (NYSE:MS) to adopt its model of zero-commission trades. The coronavirus pandemic was also a boon for the app as homebound people turned to online trading, while a stampede of investors that have jumped into "meme stocks" and cryptocurrencies has continued to propel its popularity.
By the numbers: Selling 55M shares in the offering at a price of $38, Robinhood raised slightly over $2B (at a valuation of nearly $32B). Users have more than doubled to 18M over the 12 months through March, while revenue more than quadrupled over the same time period to $1.4B. However, meme-stock madness has led to big losses of late and the company agreed to pay $70M to settle a FINRA probe in June. Options trading accounts for about 38% of Robinhood's revenue, while equities and crypto are 25% and 17% of sales, respectively.
Advantages: Growth is off the charts and half of all brokerage accounts opened in the U.S. from 2016 to 2021 have been set up on Robinhood. The company is also hoping to expand into other initiatives, like IRAs and Roth IRAs, to help turn short-term investors into long-term ones. It could also offer other types of services like debit cards, credit cards, car loans and crypto wallets.
Risks: The app has been in the regulatory spotlight over gamification, which encourages users to trade more via rewards and celebratory notifications. Payment for order flow, the way Robinhood makes money, has additionally come under intense scrutiny, as it could create conflicts of interest and prevent investors from getting the best price for their trades. Retail investing could also slow and the Robinhood prospectus named seven U.S. state and federal bodies investigating the app.
The industry: 2021 hasn't been a good year for big IPOs in the U.S. Among companies that have raised more than $2B - including AppLovin (APP), Bumble (BMBL), Coupang (CPNG), DiDi (DIDI), Playtika (PLTK) and Shoals (SHLS) - all are down by double digit percentages since their first close. The Renaissance IPO ETF (NYSEARCA:IPO) is also off 19% from its February highs and down more than 5% YTD. That could signal that the market is having a harder time digesting bigger deals - amid a glut of massive equity issuances - and may deter investors from buying more IPOs if they are already underwater. (38 comments)
Outlook
Gear up for the next big spectacle in Washington as the debt ceiling comes back into force this weekend following a two-year suspension. The deadline will curb the Treasury's capacity to issue new debt unless lawmakers can reach an agreement, which seems far-fetched at the moment due to the Republican position. GOP leadership contends that Democrats are in a spending free for all and will only support raising the debt ceiling if they promise major spending reforms and cutbacks.
Analyst commentary: "It is a very slow moving train wreck," outlined Gennadiy Goldberg, rates strategist at TD Securities. "The longer they delay raising the debt ceiling, the more Treasury has to [reduce] bill supply leaving less debt to invest in, particularly on a short-term basis. What you are going to see is more and more pressure on money market rates, which in turn will put pressure on money market funds."
It's already having some effects. Starting at noon on Friday, the Treasury used the first of its so-called "extraordinary measures," which suspended sales of securities that help states and municipalities invest bond proceeds. Others will take months to kick in, and starting in October or November, the Congressional Budget Office predicts the Treasury will run out of cash. While raising the debt ceiling has turned into a bitter partisan issue in recent years, both sides have always reached a late deal to avoid the country going into default.
Go deeper: Many expect a similar scenario this time around and the game of chicken could continue in the coming months. However, if Democrats can't get support from ten Republican senators, they may be forced to increase the debt limit via an upcoming budget reconciliation bill (which only needs a simple majority). They could also advance a vote to raise the debt ceiling along straight party lines before the August recess or tie the debt ceiling to a must-pass funding bill at the end of September.
Analyst commentary: "It is a very slow moving train wreck," outlined Gennadiy Goldberg, rates strategist at TD Securities. "The longer they delay raising the debt ceiling, the more Treasury has to [reduce] bill supply leaving less debt to invest in, particularly on a short-term basis. What you are going to see is more and more pressure on money market rates, which in turn will put pressure on money market funds."
It's already having some effects. Starting at noon on Friday, the Treasury used the first of its so-called "extraordinary measures," which suspended sales of securities that help states and municipalities invest bond proceeds. Others will take months to kick in, and starting in October or November, the Congressional Budget Office predicts the Treasury will run out of cash. While raising the debt ceiling has turned into a bitter partisan issue in recent years, both sides have always reached a late deal to avoid the country going into default.
Go deeper: Many expect a similar scenario this time around and the game of chicken could continue in the coming months. However, if Democrats can't get support from ten Republican senators, they may be forced to increase the debt limit via an upcoming budget reconciliation bill (which only needs a simple majority). They could also advance a vote to raise the debt ceiling along straight party lines before the August recess or tie the debt ceiling to a must-pass funding bill at the end of September.
U.S. Indices
Dow -0.4% to 34,935. S&P 500 -0.4% to 4,395. Nasdaq -1.1% to 14,673. Russell 2000 +0.6% to 2,223. CBOE Volatility Index +6.1% to 18.24.
S&P 500 Sectors
Consumer Staples +0.2%. Utilities +0.3%. Financials +0.7%. Telecom -1.%. Healthcare +0.5%. Industrials -0.3%. Information Technology -0.7%. Materials +2.8%. Energy +1.6%. Consumer Discretionary -2.6%.
World Indices
London +0.1% to 7,032. France +0.7% to 6,613. Germany -0.8% to 15,544. Japan -1.% to 27,284. China -4.3% to 3,397. Hong Kong -5.2% to 25,908. India -0.7% to 52,587.
Commodities and Bonds
Crude Oil WTI +2.3% to $73.72/bbl. Gold +0.6% to $1,812.3/oz. Natural Gas -3.6% to 3.915. Ten-Year Treasury Yield +0.3% to 134.56.
Forex and Cryptos
EUR/USD +0.85%. USD/JPY -0.74%. GBP/USD +1.14%. Bitcoin +23.6%. Litecoin +16.%. Ethereum +14.6%. Ripple +23.8%.
Top Stock Gainers
Flora Growth (NASDAQ:FLGC) +160%. Bit Digital (NASDAQ:BTBT) +113%. Xenetic Biosciences (NASDAQ:XBIO) +62%. LendingClub Corporation (NYSE:LC) +54%. Allied Healthcare Products (NASDAQ:AHPI) +51%.
Top Stock Losers
Annovis Bio (NYSE:ANVS) -71%. Höegh LNG Partners (NYSE:HMLP) -67%. ATI Physical Therapy (NYSE:ATIP) -64%. Alset EHome International (NASDAQ:AEI) -61%. Forward Pharma A/S (NASDAQ:FWP) -55%.
Where will the markets be headed next week? Current trends and ideas? Add your thoughts to the comments section.
Dow -0.4% to 34,935. S&P 500 -0.4% to 4,395. Nasdaq -1.1% to 14,673. Russell 2000 +0.6% to 2,223. CBOE Volatility Index +6.1% to 18.24.
S&P 500 Sectors
Consumer Staples +0.2%. Utilities +0.3%. Financials +0.7%. Telecom -1.%. Healthcare +0.5%. Industrials -0.3%. Information Technology -0.7%. Materials +2.8%. Energy +1.6%. Consumer Discretionary -2.6%.
World Indices
London +0.1% to 7,032. France +0.7% to 6,613. Germany -0.8% to 15,544. Japan -1.% to 27,284. China -4.3% to 3,397. Hong Kong -5.2% to 25,908. India -0.7% to 52,587.
Commodities and Bonds
Crude Oil WTI +2.3% to $73.72/bbl. Gold +0.6% to $1,812.3/oz. Natural Gas -3.6% to 3.915. Ten-Year Treasury Yield +0.3% to 134.56.
Forex and Cryptos
EUR/USD +0.85%. USD/JPY -0.74%. GBP/USD +1.14%. Bitcoin +23.6%. Litecoin +16.%. Ethereum +14.6%. Ripple +23.8%.
Top Stock Gainers
Flora Growth (NASDAQ:FLGC) +160%. Bit Digital (NASDAQ:BTBT) +113%. Xenetic Biosciences (NASDAQ:XBIO) +62%. LendingClub Corporation (NYSE:LC) +54%. Allied Healthcare Products (NASDAQ:AHPI) +51%.
Top Stock Losers
Annovis Bio (NYSE:ANVS) -71%. Höegh LNG Partners (NYSE:HMLP) -67%. ATI Physical Therapy (NYSE:ATIP) -64%. Alset EHome International (NASDAQ:AEI) -61%. Forward Pharma A/S (NASDAQ:FWP) -55%.
Where will the markets be headed next week? Current trends and ideas? Add your thoughts to the comments section.
Want More Ideas?
Our best ideas → Stock Ideas
ETF's Investing Ideas → ETF Ideas
Dividend stocks ideas → Dividend Ideas
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