Uncertainty affects oil prices



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Last Week’s Highlights

Oil had the worst week in 10 years

Oil posted its biggest weekly loss in 10 years. West Texas Intermediate was down 1% on Friday and more than $14 in total for the week. This drop came after the U.S. President, Joe Biden, ordered an unprecedented release of U.S. strategic stockpiles to curb runaway prices. The U.S. plans to release 1 million barrels per day for six months and other countries part of the International Energy Agency (IEA) also assured that they will release another round of oil reserves. Biden’s decision comes after gasoline prices have soared in the U.S. and because of the level of concern about supply shortages following Russia’s invasion of Ukraine.

Ford and GM halt production

Ford Motor Company and General Motors have both individually announced that they will cancel production next week due to supply problems. Ford will stop production at its Flat Rock assembly plant, where the Mustang is manufactured, due to the worldwide shortage of semiconductors. Something similar happened last month when they were forced to stop production at their Kansas City assembly plant, which manufactures the F-150 pickup trucks, for a week. Ford had already announced that due to this problem, the production volume of its vehicles in the current quarter will be reduced. On the other hand, General Motors canceled next week’s production at its Lansing Grand River assembly plant due to a temporary shortage of other pieces, not at all related to semiconductor chips.

Coming Up This Week

Intel’s new acquisition

Intel Corporation announced that there is an agreement to acquire Granulate Cloud Solutions for an undisclosed amount. Granulate is a developer of real-time optimization software. With this acquisition, Intel will help cloud and data center customers improve the performance of computing workloads. This will also reduce infrastructure and cloud costs. Intel’s goal is to build a portfolio of software optimization tools that meet the high demands in today’s computing market. This deal is expected to close in the second quarter of 2022.

Apple getting into fintech

Apple is reportedly developing a project called “Breakout”, which aims to replace its fintech partners. The company’s CEO, Tim Cook, said: “We continue to invest in innovation across our services business, which set another all-time revenue record last quarter and performed even better than we had anticipated”. According to several specialists, those venturing into the payments market do it to retrieve financial data from consumers, useful for developing other services. Apple could become a major fintech powerhouse. Companies currently developing in this area should be careful if this tech giant enters the market.

All information provided was collected up to the last business day of the previous week of the release of this NewsFlight. The purpose of NewsFlight is to summarize and make accessible information on a variety of topics within the world of investing and personal finance, and thus cannot be considered formal research or reports. All sources utilized to compile the NewsFlight newsletter are considered trustworthy by the FlexInvest team. FlexInvest is not affiliated with and does not receive remuneration from the news sources used to compile NewsFlight. As well, any images or logos incorporated into the NewsFlight newsletter are not necessarily property of FlexInvest and may solely be included to provide context for the news covered. NewsFlight should not be taken as advice to sell or buy securities or to make any investment. When investing in securities or other financial products, there is always the potential to lose money or asset value. FlexInvest recommends that its users consider their investment objectives and risks before investing. Additionally, any projections or analysis made by authors of NewsFlight cannot be considered as a promise of future trends or returns. Opinions expressed in NewsFlight are not representative of FlexInvest.

Market News

Concerns over the Russia-Ukraine conflict continue to be ongoing and this has an inflationary effect on prices and the Federal Reserve’s response. As a result, Wall Street plunges and the S&P 500 index suffers its largest quarterly drop in the last two years.

The Dow Jones index fell 1.56%, the S&P 500 lost 1.57%, and the Nasdaq Composite was down 1.54%.

Wild Card

Nvidia stock dropped because of a column that may have spooked investors.

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Ford recalls 737,000 US vehicles over software and fire-risk issues.
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