In this article, we will take a look at 10 stocks that trended this week. If you want to see some more stocks that made their way into the headlines this week, go directly to Why These 5 Stocks Were in the Spotlight This Week.
The markets remained volatile this week as the Dow Jones, S&P 500 and the NASDAQ each fell by around 3%. Despite the more attractive valuations, the markets likely fell this week due to continued concern that the Federal Reserve will keep raising interest rates to fight inflation.
The Federal Reserve has already increased the interest rate by 5 times this year and there could be even further increases with Federal Reserve Bank of Atlanta President Raphael Bostic saying, “The lack of progress thus far has me thinking much more now that we have to get to a moderately restrictive stance. And for me, that is in the 4.25% to 4.5% range for our policy. My preference is that we get there by year end.”
If interest rates continue to go up, the economy could slow as borrowing costs increase.
Amid the market decline, several stocks such as NIKE, Inc. (NYSE:NKE) and Carnival Corporation (NYSE:CCL) were in the spotlight this week for various reasons. Furthermore other stocks such as Wells Fargo & Company (NYSE:WFC), BlackRock, Inc. (NYSE:BLK), and The Walt Disney Company (NYSE:DIS) also trended.
Source: pexels
10. NIKE, Inc. (NYSE:NKE)
Number of Hedge Fund Holders: 72
NIKE, Inc. (NYSE:NKE) fell over 14% this week with much of the drop occurring after the clothing giant reported rising inventories and lower margins for Q1. For the period, Nike’s inventories rose 44% year over year and its gross margins fell 220 basis points. Furthermore, the company expects FY23 gross margins to decline by 200 to 250 basis points for FY2023. Given the challenges, Simeon Siegel of BMO Capital cut his price target on NIKE, Inc. (NYSE:NKE) to $110 from $128 but kept an ‘Outperform’ rating. Siegel still likes NIKE, Inc. (NYSE:NKE) in the long term given the company’s scale and other competitive advantages.
9. Carnival Corporation (NYSE:CCL)
Number of Hedge Fund Holders: 24
Carnival Corporation (NYSE:CCL) declined over 21% this week given the company reported Q3 EPS of -$0.65 versus the consensus of -$0.13. Sales for the company were $4.31 billion, versus the consensus of $5.07 billion. Q4 might not be as great as the company also said its Q4 cumulative advance bookings were ‘below the historical range’. Given Carnival Corporation (NYSE:CCL)’s debt, the stock could be very volatile depending on how demand changes. If future bookings are weaker, demand for Carnival Corporation (NYSE:CCL) could not be as high as expected.
8. Royal Caribbean Cruises Ltd. (NYSE:RCL)
Number of Hedge Fund Holders: 28
Royal Caribbean Cruises Ltd. (NYSE:RCL) fell 14.7% this week given Carnival Corporation (NYSE:CCL)’s Q3 results and advance bookings commentary. Given that they are in the same sector, demand for Royal Caribbean Cruises Ltd. (NYSE:RCL) could be affected by the same factors as Carnival Corporation (NYSE:CCL). If advance bookings is weaker for Carnival Corporation (NYSE:CCL), they might not be as strong for Royal Caribbean Cruises Ltd. (NYSE:RCL).
7. Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH)
Number of Hedge Fund Holders: 28
Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) fell over 16% this week with much of the drop likely due to the Carnival Corporation (NYSE:CCL) news. Since they are in the same sector, demand for cruises from Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) might not be as strong if demand for cruises for Carnival Corporation (NYSE:CCL) are weaker than expected. If demand isn’t as strong, the earnings results of Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) might not be as great. Shares of Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) are down 45% year to date.
6. Bank of America Corporation (NYSE:BAC)
Number of Hedge Fund Holders: 99
Bank of America Corporation (NYSE:BAC) declined by 4.8% this week due to the broader market decline of 3%. Although Bank of America Corporation (NYSE:BAC) can potentially earn more money if interest rates go higher, the bank could also lose money if the economy slows too much. If that happens, Bank of America Corporation (NYSE:BAC) write-offs might increase. Shares of the stock are down 32% year to date.
Some other stocks such as Wells Fargo & Company (NYSE:WFC), BlackRock, Inc. (NYSE:BLK), and The Walt Disney Company (NYSE:DIS) also trended this week.
Click to continue reading and see Why These 5 Stocks Were in the Spotlight This Week.
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Disclosure: None. Why These 10 Stocks Were in the Spotlight This Week is originally published on Insider Monkey.
