A widely advertised rate hike from the Federal Reserve did nothing to knock US stocks off course, in fact quite the opposite as they chalked up strong gains.
Guidance from the Fed on future rate hikes initially spooked investors but then provoked a more positive response on the reckoning that the central bank's stance would help bring inflation under control.
Supporting sentiment were hopes a peace deal might be brokered between Russia and Ukraine as well as steps by Beijing to address the recent volatility in the Chinese market.
Energy stocks gave back some of their recent gains as the oil price retreated from its recent highs. Shares in vaccine-maker Moderna were in demand as it sought emergency authorisation from the US regulator for a second Covid-19 booster shot amid rising cases.
AMC ENTERTAINMENT
US cinema chain AMC Entertainment raised eyebrows as it announced a $27.9 million in Nevada gold miner Hycroft Mining. CEO Adam Aron conceded it was not an ‘obvious’ investment. Both AMC and Hycroft shares rose in response.
AMC is investing in Hycroft alongside noted precious metals investor Eric Sprott - who is investing the same amount with both parties receiving separate 22% stakes in Hycroft. The deal was reportedly brokered by Mudrick Capital - one of Hycroft's creditors and a participant in AMC's own financial restructuring in 2020.
AMC, which has been a meme stock targeted by the Wallstreetbets group of investors on Reddit, raised $1.8 billion in 2021 from stock sales to private investors though it still has a large debt pile to clear. In another recent venture which feels a closer fit with its core operations, the company announced plans to start selling popcorn outside of its movie theatres.
GAMESTOP
It's a little more than a year since GameStop exploded into international headlines, and its stock hit the roof, following the meme short squeeze in the US, yet investors may see the company as no less a high-risk bet now than then.
Shares in the New York-listed computer games retailer plunged nearly 7% after-hours last week after the company revealed that it had swung to a surprise fourth quarter loss and confirmed plans to launch a marketplace for non-fungible tokens, or NFTs.
GameStop reported Q4 losses of $147.5 million ($1.86 per share) versus $80.3 million of net earnings a year ago as quarterly revenues rose just 6% to $2.25 billion, with soaring costs hitting the bottom line.
While the loss came as a shock, based on consensus forecasts of $0.85 of earnings, at this point profits are not expected to drive the narrative or the share price. GameStop is not profitable and will not be for the foreseeable future so it is worrying that investors don't seem impressed by the company's turnaround progress or direction, with plans to set-up a marketplace for NFTs met with scepticism.
GameStop stock is now 75% off $325 peaks of 29 January 2021, and the future for the company and share price doesn't appear any clearer.
NIELSEN
It could be the end of the road for Nielsen as a listed company following reports that a group of private equity buyers including Elliott and Brookfield were putting together a $15 billion takeover bid for the TV ratings group.
Shares in Nielsen jumped 35% on the week as several news outlets reported the consortium was close to finalising a financing package.
The value of the shares fell by more than three quarters between 2016 and 2020 as investors grew concerned about how streaming platforms could be taking viewers away from traditional TV services and how that might have a negative impact on cable and broadcast network advertising and Nielsen's audience monitoring.
