Daily Drama 🎭

Daily Drama 🎭 Markets swung wildly almost every single day this week.

Highlights From Last Week:

• 🛢️ Oil Whipped Markets Around — Iran headlines kept changing the mood daily
• 🤖 AI Stocks Stayed Hot — Tech continued powering rebounds
• 🎢 Every Day Felt Different — Sharp reversals became the new normal

Transcript

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SPEAKER_00 0:00

Let's start by talking about the wild ride in the US markets this week. Wall Street really kept us guessing. Stocks and oil prices tossed and turned every single day. Monday began on a sour note, with stocks taking a hit and oil prices soaring thanks to fresh tensions with Iran. But things flipped on Tuesday, oil prices tumbled, and suddenly the SP 500 snapped right back, setting new records. The excitement didn't stop there. On Wednesday, stocks shot up even more as whispers of a potential deal to calm the oil markets surfaced. Then, on Thursday, we saw markets lose a bit of steam, wobbling as oil swung up and down, which dragged stocks a little lower. Finally, Friday brought a burst of optimism. Stocks rebounded as a strong jobs report boosted everyone's confidence, closing out another week in the green.

SPEAKER_01 0:51

That's a good reminder of how quickly momentum can shift when big global headlines take the spotlight away from company fundamentals. For many investors, this was a week where energy stocks became the hot ticket short term, while tech somehow managed to stay pretty resilient despite all the chaos elsewhere. The fact that the market bounced so wildly each day really showed just how much these record highs depend on keeping oil prices steady and inflation expectations in check. Switching gears to our own backyard, the Toronto Stock Exchange mirrored a lot of that volatility. The TSX felt every daily shake in oil prices and headline out of the Middle East. Early in the week, rising oil and renewed tensions pulled the index down. Weakness stuck around on Tuesday, especially with names like Shopify dragging things lower. But then Wednesday was a total reversal. The TSX shot up by over 400 points as renewed hope for a deal between the U.S. and Iran sent oil prices plunging, which everyone cheered. Thursday's enthusiasm fizzled as traders waited for something more concrete, but the index bounced right back on Friday to close out the week.

SPEAKER_00 2:03

You could really see how swings in energy overshadowed almost everything else in Canada this week. Rate-sensitive sectors were especially twitchy, and all the volatility shined a spotlight on just how dependent the broader index is on a few heavyweight sectors. It makes every up and down feel amplified, something we're getting better at navigating thanks to our Finleady knowledge. Speaking of roller coasters, crypto had its own storyline. Bitcoin finally broke above the $80,000 mark after trying to do so for several sessions, only to lose steam and fall back below that key level pretty quickly. Still, it ended the week higher. There was a notable shift from Strategy, a big Bitcoin treasury firm, which is moving away from a strict, never-sell Bitcoin mindset, and now seems open to selling or managing holdings actively if it makes sense for shareholders. That move comes after they reported a major quarterly loss because of Bitcoin's price dips over the past few months.

SPEAKER_01 3:05

That move in Bitcoin is another great example of how resistance can hang around at the most watched price points. The way strategy is changing its approach could mean more active management and potentially a different dynamic for supply in the crypto space. Even with these pullbacks, though, there's underlying demand propping up prices on a weekly basis, even if breakouts don't always hold. Now let's take a look at emerging markets. It wasn't just US, stocks hitting new highs, emerging market equities kept climbing too, buoyed by hopes for a US-Iran peace deal. Asian tech was in the driver's seat, with Samsung and TSMC leading the charge on more AI excitement, and currencies like the South Korean one getting a boost as well. All of this meant the emerging market index is up nearly 22% this year, with investors still flocking to Asia thanks to the strength in tech and shifting geopolitical winds.

SPEAKER_00 4:02

It's fascinating how much the rally in emerging markets is being driven by a handful of big tech names in Asia right now. While that kind of focus can make returns look impressive, it does leave things more sensitive to sudden changes in earnings or chip demand. It reminds me to keep an eye on concentration risk and not get swept up in the excitement without doing the homework. Speaking of excitement, oil markets have certainly kept traders busy. Prices were up at the end of the week after renewed U.S.-Iran tensions made everyone worry about supply snarls in the Strait of Hormuz, which is essential for global energy flow. There were some big gains at first, but then prices softened as talk of a possible truce circulated. Both Brent and WTI crude rebounded after earlier declines driven by peace hopes, but even with these swings, oil prices finished the week lower overall. All the while, traders have their eyes glued to geopolitical risk, tight supply, and the unknowns around whether a diplomatic breakthrough might tamp down volatility or just create more uncertainty. That's the thing.

SPEAKER_01 5:10

Energy volatility doesn't just stay in its lane. It can spill into inflation expectations and ripple through the entire market, impacting risk assets across the board. This can spell opportunities for energy producers, but it can be trouble for sectors like airlines or transport, where cost swings really impact the bottom line. On another front, the meme stock phenomenon was busy once more. eBay shares made a leap after GameStop CEO Ryan Cohen launched a surprise $56 billion bid to buy the e-commerce company. GameStop's offer included cash and stock at a healthy premium, and they already owned a chunk of eBay's shares. Cohen says he imagines eBay growing into a truly massive competitor against Amazon. But the buzz wasn't enough to quiet skepticism. GameStop itself took a sharp hit as investors worried about how it would finance and manage such a huge deal.

SPEAKER_00 6:05

It's so interesting how quickly traders can swing between optimism and skepticism. There was all kinds of enthusiasm about eBay, but it quickly faded on GameStop's side as financial risk and execution hurdles became clearer. These sorts of headlines just prove how much individual stocks can move on speculation, even when the actual follow-through might be a long shot. Elsewhere in the markets, we saw a more measured pace. McDonald's latest earnings report was a bit mixed. U.S. same store sales went up 3.9%, which was underneath what analysts were hoping for, mainly because more cautious customers are feeling the pinch from higher day-to-day expenses like gas and groceries. Even so, the company beat profit and revenue estimates. Still, McDonald's shares slipped after the report, with the company leaning harder into value menus and seeing global performance edge higher, although not as much as expected. In other words, demand is steady, but the pace isn't picking up much.

SPEAKER_01 7:06

It's a good signal that the consumer climate remains pretty defensive right now. There's not a lot of room for pricing power, so companies are more dependent on getting more people through the door, not charging higher prices. The muted move in the stock shows that a lot of these realities were already factored in. Shifting to the ESG front, Microsoft is reevaluating its big 2030 clean energy goal. The explosion in AI demand means their data centers are drawing a lot more power than anticipated. While Microsoft still invests in renewables and nuclear, there's also talk of using more reliable sources like natural gas. Any delay could have a ripple effect for other tech giants who are also grappling with growing AI, rising costs, and their climate pledges.

SPEAKER_00 7:55

That review from Microsoft feels like a sign of things to come as tech companies balance the realities of AI growth with their climate promises. It's going to be important to watch how companies manage that tension between expanding rapidly and maintaining climate credibility. Before we wrap up, let's touch on our Finliti jargon spotlight. Today's term is cost of goods sold, or cogs. This refers to the money a business spends to actually produce or buy the products it sells, covering things like materials and the labor needed to make those items. It doesn't include overhead like rent or marketing. Here's how you'd use it. Because her coffee shop's cost of goods sold increased due to higher bean prices, Maria needed to raise her menu prices to keep her profits steady.

SPEAKER_01 8:43

Understanding COGS matters, whether you're looking at a big company's quarterly report or managing your own side hustle. It's one more tool in the toolkit that makes each step of our investment journey clearer and more confident. Thanks for joining us today as we navigated the ups, downs, and everything in between in this week's markets. We'll be back next time to continue the adventure. Just a heads up everything we talk about on this podcast is for education and general info only. We're not giving financial or investment advice, and we're definitely not telling you what to buy or sell. Finliti isn't a registered advisor, so if you're making money moves, talk to a pro who knows your situation. Cool? Now don't forget to sign up to our newsletter so that you don't miss a market beat.