Investor attention is likely to remain on rising bond yields, which have recently become a major signal for stock trading. The action in the bond market, where longer maturities have risen to pre-pandemic levels, has worried some investors that inflation is rising, which could force the US central bank to raise interest rates earlier than promised.
As bond yields rise amid early signs of economic recovery, investors are selling riskier growth stocks and shifting their money to cyclical stocks, which lagged last year's rally.
Rotary trade has put pressure on in recent weeks. The tech-heavy index remains 7% lower than its high of about a month ago. With this macro image in mind, here are three stocks we'll be watching for the next week:
1. GameStop
GameStop (NYSE :), the physical seller of video games favored by the & # 39; rebels & # 39; from Reddit, will publish its fourth-quarter earnings report on Tuesday, March 23. market close by. Analysts expect an average of $ 1.35 in earnings per share on sales of $ 2.21 billion.
The latest earnings report comes after the retailer said this month that it selected Chewy (NYSE 🙂 founder and activist investor Ryan. Cohen to lead his ecommerce push.
While forming a strategic planning and capital allocation committee, led by Cohen, the Texas-based company says the new format will identify actions that can transform the company into a technology company and help create lasting shareholder value.
The highly volatile GameStop stock is up about 1000% this year on speculation that the company is a great game, especially after the involvement of Cohen, who has a track record of building ecommerce businesses . The stock closed at $ 200.27 on Friday.
2. Adobe Systems
Another stock that will come to the attention of investors this week is Adobe Systems (NASDAQ :). The software maker, whose product line-up includes Photoshop, will announce its first quarter earnings for fiscal year 2021 on Tuesday, March 23 following close. Wall Street expects $ 2.79 EPS and $ 3.76 billion in revenues.
Adobe's during the pandmeic showed that the software manufacturer's cloud-based creative tools are in high demand. Chief Executive Officer Shantanu Narayen has offered new creative software tools to customers to accelerate Adobe's revenue growth.
In October, the company introduced a version of its popular app, Illustrator, for Apple's (NASDAQ 🙂 iPad. It is part of an effort to offer ADBE products on more devices used by creative professionals and hobbyists.
According to a report in Bloomberg:
"Sales of the company's marketing, advertising and analytics offerings have not grown as expected this year, making it more important for Adobe to maintain a grip in the design software market."
Stocks of Adobe are down 12% this year, underperforming NASDAQ. The stock closed at $ 441.50 on Friday after an increase of 0.53%.
3. Visa
It could be another onerous week for credit card giant Visa (NYSE 🙂 after media reports say the Justice Department is investigating about its debit card business and possible anti-competitive practices.
The company said Friday afternoon that investigators have begun to gather information about Visa debit practices. The Wall Street Journal, which first reported the probe, said the DOJ is trying to determine whether the largest card network in the US has limited merchants' ability to route debit card transactions over cheaper networks.
Visa shares fell 6% Friday afternoon to close at $ 206.90. Investigators will reportedly try to determine whether Visa's reimbursement policy gives it unlawfully unfair market dominance.
