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Social Media Woes, Fintech, and Big Oil - the Week in Themes

Social Media Woes, Fintech, and Big Oil - the Week in Themes

This post kicks off a new series at Noonum where we'll take a look back at the themes, stories, and strategies that moved markets in the prior week.

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What happened?

While the S&P 500 posted a 1.5% gain on the week, cross currents and elevated volatility made for another choppy tape beneath the surface.

Members of OPEC+ pledged to raise production targets, but it did little to quell oil’s ascent as crude topped $92/barrel and remains a thorn in the Fed’s effort to combat inflation. Unlike prior cycles, U.S. producers have kept a lid on Capex, opting for greater cash flow, aggressive buybacks, and strengthened balance sheets over chasing the allure of new projects.  


Treasury yields continued their march higher with the 10-yr closing the week at 1.93%, good for its highest mark since December 2019. Rates surged Friday following a strong jobs report that showed 467,000 net additions in January.

The unemployment rate nudged a tick higher to 4.0%, but any cause for concern was offset by welcome news that the labor force participation rate – the percentage of working age Americans employed or seeking a job, grew to 62.2%.

With both inflation and the job market running hot, sell-side analysts continue to raise their expectations for the Fed’s rate hike trajectory. Leading the way is Bank of America, with the bank now calling for seven hikes in 2022.

Meanwhile, geopolitical risks loom heavy as the U.S. and its NATO allies readied sanctions against Russia’s elite should Putin invade Ukraine. Despite January’s 5.3% selloff for the S&P 500, markets remain complacent regarding the situation in Eastern Europe.


An earnings onslaught brought stock-specific stories to the forefront as Alphabet, Meta Platforms, and Amazon headlined a heavy mid-week schedule. Boosted by strength in YouTube and its core search business, Alphabet surged 6.8%, while Amazon, powered by 40% YoY growth in AWS, notched a 8.9% weekly gain.

Facebook’s transition to Meta Platforms hasn’t gone smoothly – FB tanked 21.1% for the week after reporting its first ever quarterly decline in global daily active users.

Themes in focus:

What worked?

  • Oil and Gas – saw broad-based gains on oil’s continued ascent as the oil and gas exploration and production ETF (XOP) added 5.8%. Exxon (+8.6%) led the way following a huge earnings beat and new $10B share buyback
  • E-commerce – Amazon’s blowout quarter lifted online retail as the Amplify Online Retail ETF (IBUY) posted a nearly 2% gain
  • Banks – one of the biggest beneficiaries of higher interest rates, the SPDR S&P Bank ETF (KBE) climbed just over 4%

Mixed bag

  • Fintech – a sector made up of many moving parts saw weakness in digital payments after Paypal’s earnings badly missed the mark, with the ETFMG Prime Mobile Payments ETF (IPAY) off 0.49% for the week
  • On the bright side, decentralized finance rallied on a rebound in crypto with the Amplify Transformational Data ETF (BLOK) returning over 6%
  • Social mediaFacebook’s disastrous quarter and accompanying identity crisis caused widespread pain for the space on Thursday, only to see Snap (+58.8% Friday) and Pinterest (+11.4%) recover all losses (and more) following surprise beats. On the week the Global X Social Media ETF managed a 1.7% win
  • Electric vehicles the iShares Self Driving EV and Tech ETF (IDRV) finished up 2.7%, buoyed by a nearly 6% gain in Tesla.
  • On the downside, Ford tumbled nearly 10% Friday as the global chip shortage continues to weigh on sales of its flagship F-150. Ford now commands 10.9% of the EV market and EV sales grew 167%, though they still represent a small fraction of its overall business

What’s next?

Earnings remain in focus with Pfizer, Disney, and Twitter among the most notable. Reactions thus far suggest beats and lush cash flow will be heavily rewarded, while appetite for misses and high multiples remains non-existent.  

On the macro front, all eyes will be on the Consumer Price Index report for January, set to be released Thursday. Expectations call for a 7.3% YoY jump – the highest level since 1982.