Investment Week at a Glance
Stocks finished lower for the week. The Dow Jones Industrial Average fell 2.1%, the S&P 500 was down 1.9%, and the NASDAQ fell 2.1%. Foreign stocks (MSCI EAFE) were also down for the week, falling 0.9%. Bond prices were down for the week, with the 10-year U.S. Treasury ending the week at 4.38%. (Data source: Wall Street Journal)
Markets Continue to Waver on Uncertainty
Markets across the Globe continue to fall as the war in Iran continues, and oil prices remain elevated. The extent of this conflict is still unknown to investors, and worries about getting oil through the Straight of Hormuz continue to rise. Even if we see a stop to the bombings, investors worry Iran will continue to target oil tankers to disrupt the global supply chain. With energy prices rising, investors worry about the health of the U.S. consumer going forward. U.S. markets are down roughly 9% from their all-time high, while international markets turned negative for the year this week. We will see in the coming weeks if the slide continues and we officially enter correction territory. (down 10%)
Fed Dilemma
The Fed held rates unchanged this past week as expected. Markets had little reaction, but odds of a rate cut this year have dropped as expectations are now for no cuts in 2026. The market is actually pricing in a higher chance of a hike than a cut for the remainder of the year. The Fed now faces a dilemma on what to do, cut rates and risk inflation moving higher as oil prices rise. Raise rates and risk unemployment to rise as the job market has not been strong recently. Investors will watch closely to see what happens, especially as Kevin Warsh will be the next Fed President in the coming months.
SanDisk Up Over 200% in 2026 and Over 2000% Since Its IPO last February
One of Wall Street’s top performers over the last year, SanDisk (SNDK), has soared since its IPO, reaching a total market cap of over $100 billion. The company manufactures USB flash drives, Solid-State Drives (SSDs), and memory cards (NAND). SanDisk has benefited significantly from the recent AI and data center boom. On January 29th, the company reported revenue of $3.03 billion and earnings per share of $6.20, both of which beat analyst expectations (SanDisk Investor Relations). The company provided a strong multi-year outlook fueled by demand from AI companies for its products. Some analysts project that the company could reach a $1 trillion market cap by the end of 2028 if earnings continue to grow exponentially, as they have in the last year. To see if this rapid growth is even remotely possible, investors will be tuning in during May to hear SanDisk’s next earnings report (CNBC).
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Quiz
How much is the Dow Jones off from its all-time high? (Scroll Down for Answer)
- 5%
- 7%
- 9%
- 11%
Answer:
3. 9%, the Down Jones crossed 50k this year and is now at 45,500. The 9% decline has come in the past 6 weeks, fueled by the Iran war and worries around energy prices.
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