THE BOTTOM LINE: Record highs for stocks and an oil market forecast
This week:
- The US stock market has powered to new record highs this week as investors get increasingly numb to the Donald Trump headlines coming out of Washington. But the question remains: What can eventually derail this market? Baupost Group, a $30 billion hedge fund, has cited the historically low volatility that's being pushed lower by funds using instruments to short price swings. To them, the low volatility situation could trigger "the next financial crisis."
- Apple has been arguably the most important company in the stock market over the past several years, but it's been lagging broader market indexes lately. It's experienced some weakness amid speculation that the iPhone 8 will launch later than expected, and that it will be much more expensive than previous versions. The guidance that the company provides when it reports second-quarter earnings on August 1 will be very important in dictating short-term trading. In the longer-term, this will likely be just a blip on the radar.
- Netflix has surged to a new high after a period as one of the market's most-hated stocks. The company is a modern TV network, boasting easy convenience. It also has way more growth potential than people normally think, similar to tech juggernaut Amazon. The company has almost infinitely more shelf space than the broadcast networks with which it competes, and that will only continue as it spends more and more on content.
- Helima Croft, a managing director and the global head of commodity strategy at RBC Capital Markets, discusses how Venezuela could possibly "implode," and what that will mean for the oil market, After all, the country has the world's largest proven reserve, and makes up 10% of US oil imports. Croft thinks that the situation will impact geopolitics and the macroeconomic environment to a much greater extent than it has in recent months.