This week in the markets
- The US trade deficit surged to a five-month high due to decreased exports and increased foreign imports.
- Facebook and Twitter executives faced questions from Congress on how they plan to prohibit election meddling from other countries.
- Amazon was the second company to hit $1 trillion in market valuation, although only for a short period during midday trading on Tuesday.
- Emerging markets briefly fell into a bear market as high rates and trade fears scared investors away.
US trade deficit surged 📈
The US trade deficit rose to a five-month high in July, which means we imported more goods than we exported. Economists speculate that the latest numbers could influence the Trump administration to impose yet more aggressive trade tariffs. The current trade policies have left the US in disagreement with the EU, Canada, Mexico, and China.
Facebook and Twitter under scrutiny 🔍
Twitter CEO Jack Dorsey and Facebook COO Sheryl Sandberg were questioned by Capitol Hill lawmakers on how they’re addressing issues of foreign influence and fake news on their social media platforms. Google executives were also invited but declined the invitation. Lawmakers responded by leaving an empty chair at the hearing, which caused many to criticize the search engine.
The hearing was meant to uncover how the tech executives plan to distinguish between real content and disinformation. If Twitter and Facebook are unable to curate content, Congress could potentially impose regulations on the companies (and that’s not fake news).
Amazon hits $1 trillion mark 🥈
Amazon is now the second American company to reach $1 trillion in market valuation. Its share price rose to $2,050.50 on Tuesday morning, pushing the company past the $1 trillion mark, before falling back down to $2,039.51 at market close. It was a quick but satisfying climax for the company. Founder Jeff Bezos is currently worth nearly as much as Bill Gates and Warren E. Buffett combined (imagine his dinner parties). Amazon employs more than 550,000 people and generates $178 billion in annual revenue.
Emerging markets cause worry 😬
US monetary policy, trade worries, and the economic meltdowns in Argentina and Turkey likely caused emerging markets to fall briefly into bear-market territory midday Thursday. This may be partially due to the Federal Reserve raising rates and tightening monetary policy, making it harder for emerging markets to repay dollar-denominated debt. Tighter trade conditions by the Trump administration have also been tough on these markets, and all the tension has some investors slightly worried.
And now for your weekly Lionomics wrap-up 🤓
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Did you miss last week’s market update? Check it out. Market update: NAFTA in review, and Uber makes a friend.
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