Stocks on Wall Street ended higher Friday, with the benchmark closing at another all-time high as markets shook off the monthly CPI printout since 1982.
The coming week is expected to be busier than usual with all eyes on Wednesday's Federal Reserve. The US central bank plans to accelerate its bond-buying program and says it expects to start raising interest rates in 2022.
In addition to the Fed, there is also important economic data this week, including the latest US and reports, as well as another set of noteworthy earnings from companies such as Adobe (NASDAQ:), FedEx (NYSE:) and Rivian Automotive (NASDAQ:).
Regardless of which direction the market goes, below we highlight one stock that is likely to be in high demand and another that could fall further.
Remember, however, that our timetable is for the coming week only. as shares of the cybersecurity specialist will be added to the key as part of its annual reconstruction.
The Sunnyvale, California-based company will join the leading technology benchmark — which tracks a basket of the 100 largest, most actively traded U.S. companies listed on the — after its close on Friday, December 17 .
In general, stocks making the jump to the closely watched index usually benefit from increased liquidity and increased interest from individual and institutional investors. According to a NASDAQ study based on the analysis of NASDAQ 100 additions from 2010 to 2020, stocks tend to outperform the broader market from five days before announcement to post-index inclusion.
That should bode well for shares of the high-flying, cloud-based information security company, which develops and sells cybersecurity solutions such as physical firewalls, antivirus software, intrusion prevention systems, and endpoint security components.
FTNT, which started the year at $148.53 and soared all the way to a record high of $355.35 on November 8, finished Friday's session at $332.63. At its current level, the cybersecurity firm has a market cap of approximately $54.4 billion.
Fortinet has thrived this year amid strong demand for its products and services as the COVID-19 pandemic and the shift to the work-from-home environment accelerated enterprise digitization trends.
Year-to-date, shares of the fast-growing tech company have gained nearly 124%, easily outperforming the comparable returns of both the S&P 500 and NASDAQ over the same period.
Stock To Dump: Robinhood Markets
As the Fed prepares to tighten monetary policy more aggressively than previously thought, unprofitable tech companies like Robinhood Markets (NASDAQ:) appear to be suffering further losses. Additionally, HOOD stocks are also expected to go through a challenging week as investors continue to worry about the negative impact of several factors that are confusing the popular stock trading app.
In general, expectations of a less moderate Fed policy weigh more heavily on high-growth technology stocks with high valuations, as it threatens to erode the value of their cash flows over the longer term.
HOOD, which began trading on the New York Stock Exchange at $38 after the company's much-hyped IPO in late July, ended Friday's session at a record low of $20.13, more than 75% below its high point ever of $84.12. on August 4. At its current level, the Menlo Park, California-based stock market trading platform has a market cap of $17.3 billion.
As a sign of how badly Robinhood's business has fared in recent months, the financial services company reported disappointing financial results in late October, amid lower retail trading activity and as crypto trading declined.
It also provided weak guidance, warning that many of the negatives impacting third-quarter results, such as seasonal headwinds and lower retail trade activity, could persist through the end of the year.
Complementing bleak sentiment, the company advised in October that possible SEC intervention in a payment arrangement between brokers and trading firms – known as "Payment For Order Flow." (PFOF) – could pose risks to its core activities.
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