The weekend is finally here, and it is almost time to log off and enjoy the spring weather. However, before you go, make sure you are all caught up on the news. So what did the stock market do today?
- The S&P 500 closed down by 0.72%
- The Dow Jones Industrial Average closed down by 0.54%
- The Nasdaq Composite closed down by 0.85%
So what else did the stock market do today? Here are the top stories.
What Did the Stock Market Do Today? Gamble With SPACs.
It has been a rough few weeks for special purpose acquisition companies, highlighting the dangers they present to retail investors.
First, the U.S. Securities and Exchange Commission asked pre-merger SPACs to classify their warrants as liabilities on their balance sheets. This means that companies will need to re-value their warrants, and cost big bucks in accounting fees. It also could mean that blank-check companies miss out one of the biggest incentives they offer early investors.
Second, regulators came back with a new missile. It turns out they are considering when safe harbor provisions actually apply to forward-looking statements. For blank-check companies relying on bold growth projections to drum up hype, this could hurt. Plus, many companies choosing to come public benefit explicitly from the SPAC model. These shell companies offer a guaranteed route to the public markets and minimize debut volatility.
As InvestorPlace Markets Analyst Joanna Makris puts it, SPACs may seem like a weapon of the retail investor. However, that is not usually the case.
Instead, if you want to profit from the SPAC boom, Makris recommends doing what the hedge funds do. Invest in a handful of pre-merger special purpose acquisition companies that have limited downside risk. Some of her top picks include Apollo Strategic Growth Capital (NYSE:APSG), Soaring Eagle Acquisition (NASDAQ:SRNGU) and Dune Acquisition (NASDAQ:DUNE).
You can read more about SPAC stocks here.
Condom Stocks Offer Portfolio Protection
Want a safe way to play the grand reopening story? If so, you better check out condom stocks.
Today, CNN reported that condom makers are seeing rapidly growing sales, and the retail chains that sell condoms are reporting the same thing. For Church & Dwight (NYSE:CHD), the parent company of the Trojan brand, and for Reckitt Benckiser (OTCMKTS:RBGLY), the parent of the Durex brand, this is good news. It also is good news for stores like Walgreens (NASDAQ:WBA) and CVS Health (NYSE:CVS).
So what is the story here?
Although many investors have been looking at reopening plays like Carnival (NYSE:CCL), Hilton (NYSE:HLT), Caesars (NYSE:CZR) and American Airlines (NASDAQ:AAL), it seems that there may be an opportunity for profit much closer to home. As CNN tells it, many consumers simply were not in the mood at the start of the pandemic, thanks to challenges like adapting to remote learning. Add in restrictions that weighed on casual dating, and it makes sense why sales were down.
Now, it seems that everything is changing.
While condom stocks are not the bet you want to focus your whole portfolio on, they illustrate just how far-reaching this recovery story is. Next time you are looking for a unique opportunity, be sure to consider all the ways Covid-19 has impacted daily life. You can read more about the condom stocks catalyst here.
Winners, Losers, Honorable Mentions
Winners: Ethereum (CCC:ETH-USD) stole the show this week, setting a series of all-time highs. European officials are offering bonds on the Ethereum blockchain, and regulators are moving forward with Ethereum exchange-traded fund listings. It seems that with Bitcoin (CCC:BTC-USD) dominance fading, investors are really buying into the No. 2 crypto. In fact, ETH is so hot that one analyst thinks Ethereum prices could hit $10,000 by the end of 2021.
Losers: Honestly, some of the biggest losers this week were consumers. It seems that every day we learned of a new shortage getting ready to hurt consumers over the summer, from gas, to chicken wings, to boba, to chlorine tablets. A variety of supply chain issues, a winter weather crisis and Covid-19 are behind these shortages, and they are finally catching up with shoppers. Just today, we learned that Occidental Petroleum (NYSE:OXY) may be a star pick in the race to have clean swimming pools.
Honorable Mentions: Dogecoin (CCC:DOGE-USD) may be cooling off after setting record highs above 40 cents, but the meme coin is still captivating Wall Street. This week, we learned that Dogecoin miners pulled into record revenue. That makes speculative mining companies like Hello Pal (OTCMKTS:HLLPF) worthy of honorable mentions. Another pick? Crocs (NYSE:CROX), which reported stellar earnings and saw its special Lightning McQueen shoes sell out in minutes.
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 the Editor of Today’s Market with InvestorPlace.com.
