Bed Bath & Beyond shares gain 92% as meme stocks soar (2 min read)
Shares of Bed Bath & Beyond rose 92% to close at $5.86 on Monday. The stock hit a 52-week low of $1.27 in January but has more than quadrupled since. The company is struggling to avoid bankruptcy as it has accumulated over $1 billion in debts, and recently received a default notice from JPMorgan. The stock rally is part of a broader trend among meme stocks, with GameStop and AMC up 29% and 68% YTD, respectively. AI-related equities have also been popular among investors, with stocks like C3.ai and SoundHound spiking in double digits as well.
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Google announces Bard A.I. in response to ChatGPT (2 min read)
Google has announced Bard, an AI chatbot that will compete with OpenAI's ChatGPT. It will be tested with "trusted testers" before a wider release. The chatbot technology comes after employees raised concerns about Google's competitiveness in AI due to the popularity of ChatGPT. Similar to ChatGPT, Bard will simplify complex information and multiple perspectives into easy-to-digest formats. Google will combine external feedback with its own internal testing to ensure the responses meet high standards for quality, safety, and accuracy.
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Yellen: 'You don't have a recession' when U.S. unemployment at 53-year low (2 min read)
US Treasury Secretary Janet Yellen said she sees a path for avoiding a recession in the US as the economy remains resilient and inflation continues to decline. January’s job growth was strong and unemployment rates dropped to a 53-year low of 3.4%. She cited measures by the Biden administration, including the Inflation Reduction Act, CHIPS Act, infrastructure law, and a price cap on Russian oil, as drivers of reducing inflation. Yellen also called on Congress to raise the US debt limit and warned of potential catastrophe if they fail to do so.
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Stocks close lower Monday as higher rates rattle investors (2 min read)
US stocks fell on Monday, with the Nasdaq posting the biggest loss of 1%. The decline in stocks was driven by investors becoming increasingly cautious of rising bond yields and the rise in the US Dollar Index. Retail and consumer stocks such as Apple, Target, and Nike ended the session down, while defensive stocks like Merck and Coca-Cola advanced. The earnings season is about halfway through, and profits for S&P 500 companies are expected to be 2.7% lower for the fourth quarter.
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Do Stocks With High ESG Ratings Hurt Fund Performance? (3 min read)
A new study shows that fund managers who invest their own money in their funds believe that ESG stocks will hurt returns. The study was conducted on 1,273 US funds from 2015 to 2020, and it found that managers who have skin in the game tend to have a lower proportion of highly-rated ESG stocks than peers. The popularity of ESG strategies is mainly driven by client demand, as managers invest more in high-ESG stocks when their compensation is tied to flows.
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How ETF Investors Are Playing ‘the Most Anticipated Recession of All Time’ (7 min read)
Experts believe there will be a global recession in 2023. The US is expected to see a relatively moderate recession while Europe will see a less deep recession. Market consensus is that the Fed will cut interest rates at the end of 2023, boosting fixed income markets. However, investors are wary of taking risks in fixed income and are looking for opportunities in equities and some areas of fixed income that are attractively priced. This includes short-duration fixed income and international markets with relatively cheaper valuations like Europe, Japan, and EMs.
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Thanks,
Thomas
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