For this weeks instalment of 5 Point Friday, we give insight into 5 market themes to keep an eye on in 2022.
Chinese Big Tech – 2021 saw US based tech companies such as Apple, Meta (Facebook), Alphabet and Amazon all hit new highs, but this was not the case for Chinese tech companies. The Chinese state made moves to control threat to political power, causing Alibaba’s stock to plumet 50%. Other Chinese tech companies such as Tencent, Baidu and JD.com also plunged. Will 2022 see a return for Chinese tech companies if the state can big tech as compatible with its policy goals?
Meme stocks – January of 2021 saw retail investors take on wall street giants. Using loose monetary policy and stimulus payments to surge GameStops stock more then 30 fold. The meme stock madness continued with companies such as AMC, blackberry and into the crypto world with Doge Coin and Shiba Inu advancing thousands of percent. We have even see this spread to the ASX in lithium battery and semiconductor tech.
Green energy – As the world pushes further toward green energy, we are seeing more and mor companies take on initiatives to reduce their carbon footprints. President Bidens plans to achieve net-zero green house emissions in America, paired with ever increasing focus on ESG investing could make for an interesting year in the green energy space.
Crypto Currencies – Cryptos rise continued to grow in 2021, seeing massive gains across the sector. The back half of 2021 has seen the Metaverse begin to move ahead in leaps and bounds, as this continues through 2022, we may see an influx of crypto tracking ETF’s introduced to global markets that could see great returns to investors who find the right ones early.
Interest Rates – Record low interest rates due to the Corona Virus Pandemic were planned to be kept until at least the end of 2022, but as inflation has sored to 40 year highs, the Fed has begun to rethink this. The most recent projections say that 2022 could see as many as 3 rate hikes. This tends to lead in a drawback in stock market activity as borrowing becomes more expensive, and interest paid on debt grows.
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