Well, we made it through the halfway point of the trading week. A cloud company debuted, Chinese stocks took a dive and General Mills (NYSE:GIS) had to answer reports that a consumer found shrimp tails in Cinnamon Toast Crunch. So what else did the stock market do today? Dive in with InvestorPlace below.
To start, the major indices did quite a bit of flip-flopping throughout the day. Although investors initially thought they were in the clear, stocks mostly ended Wednesday in the red. The S&P 500 shed 0.55%, while the Dow Jones Industrial Average shed 0.01%. The Nasdaq Composite also dipped, losing 2.01%.
So what else did the stock market do today? Here is a look at the top three stories.
What Did the Stock Market Do Today? Fret About Delisting.
Today was an ugly day for U.S.-listed Chinese stocks.
Trade tensions have been lingering in the air, with a U.S.-China trade deal far from resolved. Talks last week between senior officials went south, and pundits are already warning that ongoing trade tensions serve as a stock market headwind.
Enter today an update from the U.S. Securities and Exchange Commission. Officials moved to adopt measures that would delist foreign companies from American stock exchanges if they do not comply with certain requirements. Investors should note that this news did not appear out of thin air. The SEC is simply addressing the Holding Foreign Companies Accountable Act, which President Donald Trump signed into law in December 2020. The legislation calls for the delisting of foreign companies that do not meet U.S. auditing standards, and also requires them to disclose government affiliations.
Specifically, the legislation is eyeing Chinese companies that fail to comply. The bill requires companies to name any board members who are Chinese Communist Party officials. Additionally, it came about in the wake of the Luckin Coffee (OTCMKTS:LKNCY) accounting scandal.
Today, investors panicked. A selloff hit everything from Nio (NYSE:NIO) to iQiyi (NASDAQ:IQ) to Baidu (NASDAQ:BIDU). U.S.-listed Chinese stocks found themselves deep in the red. Also hurting names like Nio, Xpeng (NYSE:XPEV) and Li Auto (NASDAQ:LI) is the fact that an ongoing chip shortage and market sentiment are weighing on EV stocks.
What should investors do? A key point about the Holding Foreign Companies Accountable Act is that it is not targeting all foreign companies. If your favorite Chinese stocks meet auditing standards and are willing to disclose that information, they will stay in the clear. This is a question then of how much you trust execs at Nio, iQiyi or Baidu.
The Ever Given Better Not Give Up
Did you find yourself anxiously following updates to the Ever Given story on social media today? It seems that many investors were tracking the story of the container ship.
Starting on Tuesday evening, the Ever Given found itself wedged across the Suez Canal, where it was blocking all other traffic. On its way from a port in China to the Netherlands, the skyscraper-sized ship faced effects from an Egyptian sandstorm and was unable to navigate. Now stretching from the east to the west sides, the container ship is blocking other traffic and threatening all sorts of shipping ramifications.
So what should investors know? First of all, this is truly a historic problem. Officials have said that they are not aware of anything similar happening in the last 150 years. Beyond that, it will truly be a challenge to free the Ever Given. Although rescuers have reported some progress, the mission continued through Wednesday evening.
The second thing for investors to note is that the fallout from this could be intense. This is because the Ever Given is blocking other ships — including those that carry a significant portion of the global oil supply. As Vivian Yee and Peter Goodman wrote for the New York Times, if the ship is not freed in a few days, it will also deliver a massive blow to the shipping industry.
Still not sure what this all means? You can enjoy the Suez Canal memes popping up while onlookers wait for the Ever Given to be freed.
NFT Stocks Gain Some Legitimacy
It is no secret that investors are chasing NFT stocks.
As non-fungible tokens (NFTs) continue to rise in mainstream popularity, investors want to find ways to profit. Over the last few days, we have seen that manifest in intense cyber-sleuthing and social media speculation. Sometimes sheer hope has been enough to thrust an equity forward as a NFT play.
That is starting to change. Although investors are still fond of purely speculative NFT stocks like online art marketplaces Takung Art (NYSEMKT:TKAT) and Oriental Culture (NASDAQ:OCG), a few companies are actually announcing NFT moves. Today we saw Swiss WiseKey (NASDAQ:WKEY) announce offerings that will help authenticate and secure other NFT transactions. Hall of Fame Resort & Entertainment (NASDAQ:HOFV), still waiting for a deal with the NFL, struck another partnership to offer sports-related NFTs. Toy manufacturer Funko (NASDAQ:FNKO) is talking up its NFT plans, promising exclusive and rare offerings.
To be fair, Hall of Fame and Funko were not exactly top stocks a few weeks ago, and they are far from household names. They do suggest what is to come — real NFT offerings from real companies. Keep this theme on your radar, and look at our top 10 NFT stocks to watch here.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer with InvestorPlace.com.