This week in the markets

  • On Wednesday, Facebook released its earnings report, which showed its slowest growth ever and caused a massive 20% drop in after-hours trading.
  • A proposed $12 billion in federal aid could help alleviate the impact of trade tariffs on American farmers.
  • The White House announced that the US and EU will maintain a “close relationship,” which helped push some markets up at Wednesday's close.
  • Stocks fell for both Boeing and General Motors Wednesday, after they reported disappointing full-year forecasts.

Facebook's stock takes a nosedive

It’s official! Facebook CEO, Mark Zuckerberg has been "downgraded" to the sixth richest person in the world (previously the fourth) after Facebook’s stock plunged 20% in after-hours trading on Wednesday. The loss came after the company announced that it anticipates revenue growth to slow as it “puts privacy first” and rethinks its product experience.

This is a classic lesson for MoneyLion Plus members on why it’s good to focus on the long-term when investing your money. Earlier Wednesday, Facebook stock also saw an all-time high, proving the markets can be unpredictable.

$12 billion could help farmers

The White House proposed an additional $12 billion in federal aid for farmers to help compensate for the ever-expanding trade feuds in recent months. Some agricultural workers have seen price drops in produce, as other countries have imposed tariffs to counter those imposed by the US.

The US and EU make nice

The US and EU made a deal to create a zero-tariffs environment between them. President Trump met with the European Commission President Jean-Claude Juncker on Wednesday, where they agreed that lowering trade barriers would be best for both sides. The oral agreement is yet to be put in writing, but it did cause a jump in most major markets at Wednesday’s close.

Boeing and GM release disappointing earnings reports

Stocks for both US companies fell on Wednesday after the release of their 2018 earnings reports, which were lower than anticipated. The declines in earnings were probably attributable to the rising costs of steel and aluminum resulting from US trade tariffs. GM announced that it may be willing to raise prices to offset the jump in the cost of steel. It may be time to buy that new car, before prices increase.

And now for your weekly Lionomics wrap-up. 🤓

Lionomics: Finance made easy

We kicked off Lionomics this week with the portfolio fundamentals of asset classes and asset allocation. You learned that an asset class is a group of investments sharing similar characteristics, like foods in a food group! Common asset classes are stocks, bonds, cash, real estate, and commodities (e.g., gold, corn, oil). Asset allocation is the process of combining asset classes (and their characteristics) to create a portfolio that is greater than sum of its parts -- one that offers a better investing experience with less volatility. Kind of like combining delicious ingredients to make something that tastes even better than each ingredient on its own.

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Did you miss last week's market update? Check it out. Market update: Amazon wins big, and Trump questions the Fed







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