Good morning and welcome to the stock market today! We are just about halfway through the week, but investors are feeling some pain. Cryptocurrencies are falling again on Wednesday, and the major indices are not much better. So with all this in mind, what will the stock market do today?
- The S&P 500 is down 1.42%
- The Dow Jones Industrial Average is down 1.45%
- The Nasdaq Composite is down 1.22%
So what else will the stock market do today? Here are some of the top stories.
What Will the Stock Market Do Today? Watch Crypto Crash.
Today is an ugly day in the cryptocurrency world. Bitcoin (CCC:BTC-USD) plunged below $35,000, and other altcoins are following suit. Ethereum (CCC:ETH-USD) is back near $2,000, and Cardano (CCC:ADA-USD) is trading at $1.23 just days after crossing $2 for the first time.
Investors are no doubt feeling a sense of panic, with #CryptoCrash trending on Twitter. Coinbase (NASDAQ:COIN) has reported site outages. But where is this all coming from? And where will cryptocurrencies go next?
It seems everything was set in motion following a May 12 tweet from Elon Musk. The leading market influencer reversed his stance on Bitcoin, announcing that Tesla (NASDAQ:TSLA) would no longer accept it as a form of payment. He also hinted that Tesla has sold its Bitcoin holdings, although he later clarified it had not. However, the damage was done. Citing the energy consumption of Bitcoin, including energy from fossil fuel sources, he said Tesla could not currently support BTC.
Since then, the crypto market has been in a state of turmoil.
Yesterday, news that China was further cracking down on cryptocurrencies hit investors hard. Although the country’s stance on crypto is not new, it still seemed to hurt. According to industry watchdogs, financial institutions will no longer be able to assist with any crypto-related transactions. Consumers in China already are banned from accessing exchange and ICO platforms.
Today, as InvestorPlace contributor Robert Lakin highlighted, talk of regulation in the U.S. is also contributing to the crypto carnage. Michael Hsu, the acting comptroller for the Office of the Comptroller of the Currency (OCC), will appear in a Congressional hearing today. There, he will advocate for increased scrutiny on the crypto space, breaking away from recommendations of his predecessor.
What Altcoins Can Survive the Crash?
In all the frenzy, some investors are taking to social media to show their long-term support for cryptocurrencies. They are rallying behind hashtags like #HODL and #BuyTheDip, looking to exchanges like Coinbase for a change to get into once red-hot cryptos.
But what altcoins can survive the crash? And what is the best path forward?
Today, some of the best-performing cryptos on the CoinMarketCap platform are leveraged short tokens, giving investors a chance to profit from the downward moves in Bitcoin and its peers. For instance, Amun Bitcoin 3x Daily Short (CCC:BTC3S-USD) is one of the most popular cryptos on the platform today. As its name implies, it gives investors exposure to -3X the daily movements of Bitcoin. Similar tokens for Ethereum, Cardano, Stellar Lumen (CCC:XLM-USD) and XRP (CCC:XRP-USD) are gaining traction too.
However, InvestorPlace contributor Mark Hake has a better approach to navigating the crypto crash. Hake went through the top altcoins and found cryptos that investors have a reason to believe in. More specifically, he found cryptos that offer real utility and technological advantages that Bitcoin does not.
Here are the seven altcoins he thinks will last long after today’s crypto carnage. Hint: Ethereum and Cardano top the list.
What Else We’re Watching
- Campaigns to raise the minimum wage across the country are gaining momentum. Today, workers at McDonald’s (NYSE:MCD) are striking for $15 per hour. Chipotle (NYSE:CMG) recently raised its hourly minimum to $15. Bank of America (NYSE:BAC) made a splash this morning, announcing it will hike its minimum rate to $25 per hour. With pressure on President Joe Biden and lawmakers to take action at the federal level, this is a story investors should pay attention to, especially as it intersects with the ongoing labor shortage.
- Ford (NYSE:F) will unveil its all-electric F-150 tonight, and analysts expect the debut to have impacts on the electric vehicle market. Why? Ford is a legacy automaker, and the F-150 commands great consumer respect. Could its new all-electric offering dethrone Tesla?
- Special purpose acquisition companies have been under pressure, but that is not stopping Tuttle Capital Management from offering up new SPAC ETFs. Today, two products focusing on so-called de-SPACs started trading. These products, the De-SPAC ETF (NYSE:DSPC) and the Short De-SPAC ETF (NYSE:SOGU), offer investors access exclusively to companies that have already closed their mergers.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Sarah Smith is the Editor of Today’s Market with InvestorPlace.com.