With a shortened trading week, the major indexes are set to finish in the green, with the S&P 500 and Dow Jones Industrial Average poised to hit new all-time highs. This week was fueled by the tech sector and most notably by Nvidia and Alphabet. The two main economic reports released this week were the GDP report and jobless claims, both reporting better-than-expected figures.
In corporate news this week, Target faces new pressure, as activist investor Toms Capital Investment Management built a significant stake. Target has experienced flat sales over the past four years, while Walmart has gained significant market share by emphasizing affordable groceries and leveraging its convenient delivery services. With Target’s share price falling more than 60% from its all-time high, the company is looking forward to a CEO transition in February, who plans to focus on product refreshes and a better digital experience. Nvidia once again made headlines this week in completing its largest-ever licensing deal ($20 billion) with chip startup Groq. The move is said to be both offensive and defensive, as Groq manufactures language processing units designed for AI inference.
Another company that made headlines this week was the Fox-owned free streaming service Tubi, which achieved profitability for the first time ever this year. Most of the viewers that the company attracts are millennials and Gen Z, who are willing to sit through ads, which is where Tubi makes its money. Tubi has benefited from streaming platforms such as Netflix and Amazon Prime increasing subscription prices, prompting some viewers to switch to free streaming. Among the other streaming giants that offer free streaming are the Roku Channel, Pluto TV, and Plex. Other attributes that set Tubi apart are its large media library (300,000 titles), its blend of nostalgic and original content, and its curated content for specific audiences. Many viewers describe Tubi’s diverse selection in a nostalgic way similar to the 90s Blockbuster Video store experience. Others appreciate that Tubi offers live channels with limited ads, creating a traditional cable TV experience.
In economic news, the US GDP was reported to have expanded at a 4.3% rate in the third quarter, topping estimates of 3.8%. This growth can be attributed to increased consumer spending and exports. More specifically, spending among wealthy American households and tech-led investments are driving growth. The initial jobless claims numbers came in on Christmas Eve and were better than expected, falling 10,000 to 214,000. However, analysts say the year-end holiday buzz can make numbers murkier than usual. Gas prices continue to go lower, as this month the average price is below $3 a gallon, the lowest since 2021. This continued decline in gasoline prices comes just in time for the busiest travel season of the year, with 110 million Americans expected to take road trips.
Ralph Waldo Emerson once said, “Money often costs too much.” Two weeks ago, at Stack’s Bowers Galleries, buyers spent quite a bit on 232 three-coin sets of pennies. Although they didn’t have to sacrifice the intangible costs Emerson had in mind, these pennies sold for a sum of $16.76 million, making it the most valuable modern U.S. currency sold at auction. The high sum is justified by the historic decision to end the minting of the US penny earlier this year. The number of final pennies minted symbolizes the 232 years of minting history, dating back to the first pennies minted in 1793. The director of Numismatic Americana at Stack’s Bowers, John Kraljevich, said the end of the penny minting has captured the public imagination like few rare coins they’ve ever handled. For future coin collectors, the last set of pennies produced is distinguished from the rest by a simple, unique omega symbol.
Ryan Motsinger
