Market Round Up: Global Stocks Slide 📉 Aussie Watchdog Hounds Tech Giants 🐶
1. Global Stocks Slide
It would seem that last week’s bad run of form for global stocks may only be the beginning as investors gear up for another week in the red. Asian markets woke up to a sea of declining equities this morning which is likely to contaminate Europe and then the US as the day goes on – yikes!
Last week, Wall Street’s major indexes lost more than 2% during Friday’s selling spree that has thoroughly spooked investors. The dollar index also weakened after poor jobs report data gave tentative signs that the US economy has peaked.
China and its Asian counterparts, Japan, South Korea and Australia are also feeling the pinch with all of their major indexes losing a few percent and showing signs of economic vulnerability.
The overall picture this gives us is a worrying one. The week ahead is likely to be a challenging but important milestone for investor confidence – which had returned slightly after many alarmists were calling a recession at the end of October.
Another big week of losses could erase all of the rebuilt confidence and send markets into a considerable downward spiral. Let’s hope some stable ground can be found or the little waves of red may become a tsunami before we know it!
2. Aussie Watchdog Hounds Tech Giants
Australia’s competition watchdog and regulatory board has joined the US to crack down on the online advertising dominance enjoyed Alphabet’s Google and Facebook and the spreading of ‘fake news’ – its about time!
Competition Chairman, Rod Sims, highlighted that Google’s 94% share of web searches in Australia gives it unprecedented market power – and with great power should come greater responsibility.
Sims accused google of having an opaque ranking system that incentivises it to favour its own businesses over competitors’ advertisements which unfairly influences users. The regulator is tasked with keeping an eye on this and trying to bring some transparency to the market.
Both tech giants have been battling global cases against privacy breaches which has filtered through into their stock prices. Greater regulation will likely squeeze tech firms to rule out some of their grey area practices, and push them further into the red for the year.
All we know is that the watchdog is on the case, and he may still have more questionable practices to sniff out…best of luck Google and Facebook.
Today we are watching…
1. 3M (#mmm)
US industrial conglomerate, 3M, slid 2.19% on Friday to close the week in the red. Global markets took a beating last week and it may not be over for 3M. Sellers will likely be in control towards the end of the year so keep on the lookout for more selling opportunities than buying.
2. The Cheesecake Factory (#cheesy)
The Cheesecake Factory also had a tough week as it moved below a key level at $47. Sellers managed to shave 8.2% off its share price in the last month and there may be more pain to come. This latest sell-off has forced brokers to downgrade #cheesy from a buy to a hold rating, which does not bode well for their outlook going into 2019.