2/4/2024 0 Comments Stock news anchor backgroundAnd I think it's something that, of course, Wall Street is going to continue to watch here in the days and weeks to come.Adobe Stock A stock photo showing tiles of the logo for U.S. We're beginning to see effects of this tumult. We have seen shipping companies pull their ships out of that waterway, send them on a 10-day journey around Africa to avoid that conflict there. You look at what's happening in the Red Sea. But so far, we have seen markets kind of shrug that off. I think a lot of people listen to Jamie Dimon, again, because he's running such a large institution. These are topics that he returns to time and time again, because he is sort of looking at history with a really broad breath and fearing that this could have a big effect, not just on the economy, but on sort of the geopolitical system in the world as well. You heard him there mentioning Ukraine, the war in Israel. I think they're kind of inured to the fact that we have been able to get through a lot of tumult and crises in recent months.īut Jamie Dimon stands out as the head of the largest bank in this country and somebody who is more frank and forthright about the prospect of these risks than I think a lot of executives are. And I think that these are all things that are worrying to some investors. These are seven companies that wouldn't have to do that because they have so much money on hand, Geoff. They'd have to borrow money at a higher interest rate. We're at a point where interest rates are higher than they were for a really long time.Ī lot of companies, if they want to expand, have to borrow money. And, finally, they have a lot of cash on hand. is part of it.Īnother just has to do with the fact that these are companies that are ingrained in our lives, that we use every day, that they would have staying power if there were going to be some sort of economic downturn. And there are a number of reasons for that. So they have been carrying a lot of the weight here. Those seven stocks, they rose by more than 100 percent last year. Last year, the S&P 500 was up 24 percent. So they have really outperformed the market. Nvidia, at the other extreme, this is a company that is designing most of the microchips that are used in the supercomputers that are powering the technology that allows companies to use A.I. I guess Tesla is kind of the exception to that. And as you say, these are tech companies, most of which are tied to A.I. He allowed that he's a fan of this Western movie from 1960 starring Yul Brynner and Eli Wallach, which is why he named them.īut the seven stocks are Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. This is a name that was coined by Michael Hartnett, who's an investment strategist at Bank of America. Yes, Geoff, this was a huge turning point last year. So we haven't had broad-based gains, but stocks have performed much better, I think, than Wall Street expected at the beginning of last year. They certainly weren't last year, which ended up being a much stronger year for stocks than I think a lot of people expected, in light of what I was just talking about, that being this fear that we could hit a recession. Now, I should say the gains haven't been widely shared. And they have this belief that the Federal Reserve, despite what seemed like small odds at the beginning of last year, the year before, are going to be able to engineer this so-called soft landing, that they're going to get high inflation under control without triggering a recession.Īnd that's certainly buoying the stock market. There's been some recalibration IN recent days of expectations of how soon markets think the Fed is going to actually do that, lower those rates.īut they're looking around, investors are looking around and seeing a bevy of economic indicators that are looking pretty strong. And we got this indication last year from the Federal Reserve that they were looking to make cuts in 2023.
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