Ford stock suffers worst day since 2011 after cost warning, shedding $7 billion in market value (2 min read)
Ford pre-released part of its third quarter financial earnings and warned investors of $1 billion in unexpected supplier costs. Their stocks dropped 12.3% after the news, making it the worst day on percentage loss since 2011. The company said supply issues have resulted in parts shortages affecting about 40,000 to 45,000 vehicles and the supplier cost will be higher than expected due to this problem. Many Wall Street analysts were surprised by this announcement as the supply chain problem had already gotten better over the last few months. Ford lost about $7 billion of its market value from the stock action on Tuesday.
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Peloton adds $3,195 rowing machine to fitness equipment lineup (2 min read)
Peloton is adding a new rowing machine to their product line-up. The cost starts at $3,195 and will require a $44/month membership. It is available for pre-order and deliveries expect to begin in December. This new product comes as the company is working through a restructuring plan to expand its customer base and return to a profit. Peloton had recently reported a widening loss and decline in sales for six consecutive quarters. The company said they are aiming to reach a break-even cash flow in the second half of 2023.
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More homebuilders lower prices as sentiment falls for ninth straight month (2 min read)
The US homebuilder sentiment index dropped again in September for nine consecutive months and it’s at the lowest since 2014. As interest rates continue to rise, housing is getting less and less affordable. Many home builders have reported lowing home prices. Higher labor and material costs from inflation have made it harder to lower prices but now they are forced to. Some other builders have reported using incentives such as mortgage buydowns or free amenities to help boost sales.
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Innovation Reigns In 10 Best-Performing ETFs Of The Last 3 Months (1 min read)
The top 10 best performing ETFs in the last three months are tilted towards thematic ETFs that focus on healthcare and clean energy. They had mostly benefited from Joe Biden signing the executive order to advance US based biotechnology and the Inflation Reduction Act that supports the development of clean energy technologies. These ETFs generated an average of 33.4% in returns as of Friday Sept 16. More details about each ETF and their performance are available in this article.
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Weekly ETF Flows See $25B Gain (2 min read)
The US ETF market had nearly $25 billion inflows last week which was a reversal from the $4.3 billion and $5.3 billion outflows it had the two weeks prior. Most of the inflows were primarily in the US smallcap and midcap ETFs. Fixed income ETFs continue to see strong inflows with about $3.6 billion last week, 33% higher than the week before. The ETFs that had the most outflows were S&P 500 and tech focused funds including the SPDR S&P 500 ETF Trust (SPY), the iShares Expanded Tech-Software Sector ETF (IGV) and the iShares Expanded Tech Sector ETF (IGM).
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4 in 10 Gen Zers Are Worried About the Economy. Here's How to Prepare (3 min read)
The recent Bank of America (BoA) survey showed that the economy and high inflation is the top financial concern for 42% of Gen Zers. It has made it harder for them to achieve their financial goals like saving or paying down debt. Here are some ways to prepare for economic downturns, especially when it might get worse. Make a budget or update the one you have to reflect higher living costs. Emergency fund is typically 3 to 6 months of living expenses but about 12 months will give you more security in case of job loss when the economic situation worsens. If you have any high interest debts, try to pay it off as soon as possible. It sounds harder than it looks, but as rates go up it will make the debts even harder to pay off. Bottomline is to cut costs, put away savings when possible, and pay down debts. If recession doesn’t come then you will have more money saved up, but if it does, then at least you will be more financially prepared.
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That's it for today! You can reply to this email if you have any comments or feedback.
Thanks,
Thomas
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