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Market News

SQ Net Revenue +143%, HOOD Rockets to $84 High, London Fork Lifts ETH

Alpaca Team
Alpaca Team
Square acquires Afterpay for $29M and cites Bitcoin as catalyst for revenue growth

After a rocky first couple of days trading HOOD has officially taken off! On Wednesday HOOD closed up over 50%.  

Highlights From This Week’s Earnings

  • SQ - Square reporting earnings this week and some of the highlights include Net Revenues up 143% from the prior year quarter and also an acquisition of Australian buy-now, pay-later company Afterpay for $29 billion. Bitcoin was cited as a catalyst of revenue growth and without bitcoin net revenues would only have been up 87% year over year.
  • BKNG - 458% increase in room night reservations in the 2nd quarter.
  • EA - traded up in the after-hours on Wednesday after it raised its full year outlook. The next title in the Battlefield franchise, Battlefield 2042 will be out in time for the holidays. Many investors and gamers were disappointed with the previous installment of Battlefield (Battlefield V) in 2018.
  • SPCE - Thursday evening Virgin Galactic reported revenue of $571,000 for the quarter and also opened ticket sales up for trips to space for $450,000 per seat.
  • NKLA - possibly the first meme stock NKLA has had a rough two weeks. Last week the founder of the company was indicted on three criminal charges and on Tuesday the company lowered vehicle delivery estimates to 25-50 vehicles from a previous estimate of 50-100.

ETH Spikes +10% with London Fork Rollout

Ethereum jumped more than 10% on Wednesday as the London Fork was rolled out. This upgrade will help improve the way gas fees are estimated. Meltem Demirors, Chief Strategy Officer of CoinShares was quoted as saying that “EIP-1559 (London Fork) is one of the most significant upgrades since the network’s launch.”

Investors Wait For Clarity While Feds Talk Interest Rates

Federal Reserve Vice Chairman Richard Clarida said on Wednesday that the Fed may move to increase rates from near zero in 2023. Clarida was speaking in a webinar held by the Peterson Institute for International Economics. Clarida went on to say that he would support an announcement by the Fed later in the year to scale back bond purchases by the Fed. The Fed is currently purchasing $120 billion in assets each month to stimulate the US economy. As stated last week, investors should focus on the Jackson Hole meeting this August for more clarity around interest rates and tapering.  

Alphadyne Lost $1.5B in Bets Made on Rising Rates said Bloomberg

Predicting what the Fed does and how the bond and equity markets react may be one of the major themes for the next 18 months. Hedge fund Alphadyne Asset Management reportedly lost more than $1.5 billion dollars in bets made on rising rates according to Bloomberg. The opposite happened and yields declined. The fund has apparently not had a losing year since 2006.  

Strong Earnings for Energy but Crude Drops Under $70 a Barrel

Strong energy earnings. EOG, APA, MRO and PBR all reported strong quarters this week. However, crude has pulled back below $70 a barrel on worries that demand won’t be as strong as initially thought as the delta variant spreads around the world. On Thursday there was a report from Bloomberg out of China that traffic congestion was down more than 30% in Beijing from a week earlier.  

About the Writer

My name is Allen Spence and I have been working in the retail brokerage industry for over 16 years. I joined Alpaca in March of 2021 as a Brokerage Operations Consultant. Before joining Alpaca I have worked in a retail branch environment, call center for active traders, and spent over seven and a half years as the team lead on an equity trading desk for a large regional broker dealer. I’m excited to be at Alpaca helping bring the markets to investors worldwide. I live in Florida and enjoy traveling and spending time with my family.  

About Alpaca

Alpaca is a globally distributed financial technology company that is democratizing global access to financial markets starting with our API-first stock brokerage. Alpaca offers commission-free stock trading via API, a suite of developer APIs for brokerages, advisors, and startups, as well as a market data API.

This article is solely for informational purposes only and any historical returns, expected returns or projections are hypothetical in nature. Investments in securities involve the risk of losses and past performance does not guarantee future results. Before investing you should carefully consider your investment objectives, time horizon, and overall risk tolerance as well as the information stated in the product offering prospectuses.

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