As multi award-winning broker FXTM reveals its new product offering – stock trading – the company’s Global Head of Marketing Nandik Barbhaiya takes a look at the stock landscape ahead for eager investors.
Over the past seven years, FXTM has established itself as a fast-growing authority within the industry. Known for its commitment to providing its clients with a vast array of financial instruments and superior trading conditions, the broker this week revealed its new product offering – stock trading. Offering ten of the most eminent company shares available on NASDAQ and the NYSE, including four of the FAANG group, FXTM is pleased to expand their in-demand services for its continually increasing number of loyal traders through their new Stock Trading offering. Read more about FXTM Stock Trading product here.
As 2018 comes to a close, one wonders how the stock markets will end the year. Bullishly? Bearishly? It has certainly been an interesting few months price-wise. Reigning tech conglomerates, dubbed the FAANGs (Facebook Inc., Apple Inc., Amazon.com Inc., Netflix Inc. and Google parent Alphabet Inc.), slid into bear territory in October, provoking a flutter of nervousness amongst investors who are used to relying on their ‘popular’ shares. Over the past five years, these technology giants have not only dominated the market, but now account for 40% of the total value of the NASDAQ 100 Index’s $8.3 Trillion. The FAANGs are also referred to as ‘growth stocks’, which means that they are expected to continually increase in value over time due to the persistent need for new and improved electronics and devices. As of March 2018, they are worth 3.015 trillion dollars – so the tension upon their price drop was palpable.
On 1 November, Apple announced that it would no longer be disclosing the unit sales of its Macs, iPhones and iPads – their most renowned products. Just 24 hours later, Apple stocks suffered their largest drop in almost four years, plummeting by a massive 6.6 percent. The Dow Jones Industrial Average did not escape unscathed, experiencing a negative dive of 2 percent.
The following Monday, all five FAANG stocks suffered losses, with a combined hit of over one trillion dollars. As a result, the NASDAQ index lost 12 per cent in its worst quarterly performance for ten years.
However, market conditions already seem to be showing tentative signs of a rebound. On Monday 26 November, FAANG stocks – with the exception of Netflix – rose by 1 percent. This suggested a positive turnaround for the major tech-stocks, which brought welcome relief to their investors.
Apple is continuing to rally and is valued at $165.48 at time of writing. While this is nowhere near Apple’s historical highs, it is most definitely a step in the right direction when compared to its most bearish slump of the year – which was recorded at a mere $155.5 in February. Although just one company, Apple’s $858.63 billion market cap remains a significant pillar of the S&P 500 and NASDAQ indices, providing some semblance of reassurance for nervous investors. Meanwhile, Google parent Alphabet has surpassed its peers by exiting the bear market completely – proving itself a worthy competitor amongst the FAANG group.
Facebook has also demonstrated a pleasing recovery from the past few months of distress. Prices went as low as $131.55 in mid-November, but stand at $144.06 at time of writing. While their shares have generally taken a hit this year, it must be noted that sales are up by 40% during the first three-quarters of the 2018 in comparison to Twitter’s increase of 25%.
A recent noteworthy event that helped to improve market sentiment was the G20 summit on 30 November and 1 December. Mounting trade war tensions between the U.S and China are impossible to ignore, as the implications of these two vast economies remaining at odds are far-reaching.
President Trump announced prior to the summit that he was considering further tariffs on Chinese exports in an attempt to encourage Apple to move production to the US, which placed huge pressure on Apple’s sales.
However, the meeting between Trump and President Xi resulted in a 90-day truce to allow time for further discussion. While there are no planned immediate increases in tariffs, many feel that this is a temporary situation. Further clarification on the exact terms of the truce are yet to be released.
The markets reacted to this news with an obvious sense of relief. NASDAQ immediately jumped by 2 percent while the Alibaba Group, China’s e-commerce giant, is continuing to show signs of improvement following an incredibly troubling 6 months of declines in both earnings and revenue. It also remains the 6th largest company in the world by market value.
While no one can predict market events for certain, it remains an exciting time for both investors and analysts alike. FAANG stocks in particular do seem to follow slightly more positive trends, and such is their overall popularity and exceptional branding that it’s hard to imagine investors turning away from them completely.
While it is too soon to be assured of the start of a bull market, one can also optimistically suggest that the ever-increasing demand for new and improved electronics and devices will provide tech-stocks with a form of security for some time to come.
As a client-centric broker, FXTM is devoted to fulfilling the needs of its traders and is extremely excited to add stock trading to its extensive range of products on the elite FXTM Pro Account.
If you would like to consider trading stocks with a transparent, fully-regulated broker, visit FXTM today.
Stock trading will be available for FT Global clients only.
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