MARKET HIGHLIGHTS
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market highlights
GOOD WEEK
VinFast (VFS +40.35%) a Vietnamese EV firm, witnessed a stock surge post its SPAC merger. However, with restricted shares and modest sales, the company's valuation nearing $130 billion raises queries about the disparity between stock performance and its lofty value.
Ubiquiti's stock (UI +15.34%) surged after its Q4 and fiscal year results exceeded expectations. The company's decision to keep low prices despite supply issues boosted customer loyalty and revenue growth. With a profitable model and signs of recovery, the stock remains attractive to investors.
BAD WEEK
Shares of Advance Auto Parts (AAP -5.64%) fell after disappointing earnings. The company's revenue increased slightly, but profit margins dropped, and EPS halved. The appointment of a new CEO hasn't convinced Wall Street, with multiple analysts cutting price targets, expressing concerns over ongoing discounts hurting profit margins.
Nordstrom's (JWN -7.73%) stock dropped by due to a decline in quarterly sales. While net income increased, the company's revenue decrease was attributed to store closures, timing issues, and increased theft losses. Nordstrom is a well-known American retail company that operates department stores offering a wide range of products including clothing, accessories, footwear, beauty products, and home goods.
WHAT ELSE HAPPENED
The stocks of Harmony Gold Mining, DRD Gold, and Sibanye Stillwater rose due to increased earnings, higher metal prices, and the positive impact of China's economic stimulus. If metal prices continue to rise, these stocks could experience further gains.
The US housing market is predicted to remain sluggish, even if the country avoids a recession. The market has been stagnant due to high mortgage rates, which deter both buyers and sellers. There are expectations that these conditions will persist, as elevated real interest rates are likely to keep mortgage rates high, impacting home sales. Even in the event of a recession, while interest rates might decrease somewhat, the housing market could still be affected by weakened labor markets, tight credit conditions, and lower consumer confidence.
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