Volatility has resurfaced on Wall Street. Last month, U.S. stock markets faced major setbacks for the first time in 2023. Market participants remain worried about how markets will behave this month. September is historically the worst-performing month on Wall Street. U.S. stocks have witnessed volatile trading in the first week of this month.
The Fed’s September FOMC meeting will be the key focal point this month in the absence of earnings results. Crude oil prices spiked on Sep 5, following the decision of Saudi Arabia to extend its daily production cut decision until the end of 2023. Investors are concerned that higher crude oil prices will result in higher inflation. Higher oil prices will directly affect the transportation sector, which in turn will raise the general price level. This will make the task of the Fed more difficult for a soft landing of the U.S. economy.
Moreover, on Aug 6, the yield on the benchmark 10-Year U.S. Treasury Note rose 2 basis points to 4.292%. The yield on the short-term 2-Year U.S. Treasury Note jumped 10 basis points to 5.02%. This yield is loosely linked to interest rate movement. The yield on the long-term 30-Year U.S. Treasury Note climbed 14 basis points to 4.373%. The ICE U.S. dollar Index rose to a six-month high at 104.90. A higher risk-free market interest rate is detrimental to growth stocks like technology, consumer discretionary and cryptocurrencies.
As a result, prices of cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), Cardano (ADA) and Dogecoin (DOGE) and Litecoin (LTC) remained rangebound. Cryptocurrencies may face volatility in the near-term as the Fed has already warned that a further hike in interest rate is possible as the inflation rate is currently more than double that of the central bank’s 2% target rate.
Stocks to Watch
Visa Inc. V is taking a significant step toward modernizing cross-border money movement. In a move aimed at enhancing the efficiency of global transactions, V is expanding its stablecoin settlement capabilities to the high-performing Solana blockchain. This expansion of V includes collaboration with prominent merchant acquirers Worldpay and Nuvei, marking a pivotal development in the world of digital payments.
Visa has an expected earnings growth rate of 12.8% for the current year (ending September 2024). The Zacks Consensus Estimate for current-year earnings has improved 0.8% over the last 30 days. V currently carries a Zacks Rank #3 (Hold).
NVIDIA Corp. NVDA reported second-quarter fiscal 2024 adjusted earnings of $2.70 per share, surpassing the Zacks Consensus Estimate of $2.09. NVDA posted revenues of $13.51 billion for the quarter, outpacing the Zacks Consensus Estimate by 20.89%. This compares to year-ago revenues of $6.7 billion. Management sees third-quarter revenues of $16 billion versus the Zacks Consensus Estimate of $12.34 billion.
NVIDIA has an expected earnings growth rate of more than 100% for the current year (ending January 2024). The Zacks Consensus Estimate for current-year earnings has improved 8.6% over the last 30 days. NVDA currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Robinhood Markets Inc. HOOD operates a financial services platform in the United States. Its platform allows users to invest in stocks, exchange-traded funds, options, gold, and cryptocurrencies. HOOD buys and sells Bitcoin, Ethereum, Dogecoin, and other cryptocurrencies using its Robinhood Crypto platform.
Robinhood Markets has an expected earnings growth rate of 57.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 18% over the last 60 days. HOOD currently carries a Zacks Rank #2 (Buy).
Coinbase Global Inc. COIN provides financial infrastructure and technology for the crypto economy in the United States and internationally. COIN offers the primary financial account in the crypto space for consumers, a marketplace with a pool of liquidity for transacting in crypto assets for institutions; and technology and services that enable developers to build crypto-based applications and securely accept crypto assets as payment.
Coinbase Global has an expected earnings growth rate of 84.8% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 30% over the last 60 days. COIN currently carries a Zacks Rank #3.
Block Inc. SQ is an online digital and mobile payment platform for consumers and merchants and is the parent company of Square and Cash App. The users of Cash App can buy, sell, send and receive Bitcoin. In addition, SQ’s decentralized tbd platform allows developers to build decentralized finance applications to run on programmable blockchains. SQ is also one of the largest Bitcoin investors.
Block has an expected earnings growth rate of 68% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.2% over the last 30 days. SQ currently has a Zacks Rank #3.
Visa Inc. (V): Free Stock Analysis Report
This article originally appeared on Zacks
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