We’re approaching the end of August and we thought it was high time we looked back on a bizarre 2020. You’ve joined us right in the nick of time, as we’re about to unveil the top 3 winners and losers of the year (so far). We’ll get into that before giving you a rundown of the most important events for your trading diary week commencing 24.08.20.
The pandemic dominates (of course)
It’s probably not going to come as a massive surprise to learn that the winners and losers on the following list are, largely, in their respective camps due to their performance during the pandemic. It has pretty much overshadowed everything in 2020 and some businesses have capitalised on that. Others have been far from immune.
The Biggest Winners
1. Online Entertainment
With the vast majority of the world’s population stuck inside with very little to do, we desperately needed something to do! Online entertainment services like Netflix (NFLX) seemed a reasonable option. 16 million new subscribers who signed-up during Q1 alone, the largest three-month jump in the streaming service’s 13-year history. Those numbers haven’t shown signs of slowing down yet, but it’ll be interesting to see if the company can keep up the pace as lockdowns ease and other sources of entertainment re-open.
Netflix (NFLX) share price, YTD
2. Workplace solutions
With their teams forced to work from home during the quarantine, companies turned to remote workplace solutions to enable business to continue. Having access to flexible communications solutions was vital, and many businesses found that in products like Zoom (ZM) and Slack (WORK). With Zoom, in particular, becoming a global leader in video conferencing. It’s fair to say that its product success reflected rather well on its share price.
Zoom (ZM) share price, YTD
3. Online retailers
Online retailers have weathered the pandemic pretty nicely, to the detriment of the high street. Amazon (AMZN) continues to be a juggernaut. While the company’s sales growth has been more than impressive for the past decade, it received a massive boost from government imposed lockdowns, as consumers were forced to buy online. On March 12, the beginning of the COVID-19 lockdown, the company’s stock price closed at $1,676.61. By mid-August, it had climbed to $3,148.02. It’s still on the up!
Amazon (AMZN) share price, YTD
The Biggest Losers
1. Restaurants and eateries
Restaurants and restaurant chains, like Wetherspoons (JDW) have been really hard hit as revenues fell to zero for three months. The most obvious issue for many of these venues is the impact of lockdowns and quarantines on city centres, with fewer people around after opting (or being forced) to work from home rather than the office.
If they can hold on, most of them will probably be okay, as lockdowns ease. But, whether they can hold on, with those famously high operational costs to cover, remains to be seen.
J D Wetherspoon (JDW) share price, YTD
With thousands of planes grounded for months, there’s still a question mark over the viability of international travel amid fears of further outbreaks of coronavirus. While the likes of EasyJet (EZY) and Ryanair (RYA) had expected to benefit from a growth in international travel, this is now increasingly under threat. It’s not looking great in what should be peak season.
Ryanair (RYA) shares, YTD
This one is a bit of a no-brainer, too. Some of the first venues to shut doors to the public were cinemas. Screens full of tightly-packed seats were deemed hazardous to health. As the entertainment industry shifted online, these venues lie in wait, hoping to be full again someday.
The biggest cinema chain in the world, AMC has limped on through. Yet, the company has made no secret of its struggles, last month stating that it may not survive the pandemic.
AMC shares, YTD
What’s coming up in the next trading week?
● No major events scheduled.
● Germany (EUR) will unveil its GDP Growth Rate YoY (Q2).
● The US (USD) will announce its Durable Goods Orders figures for July.
● It will also publish its Non-defense Capital Goods Orders ex Aircraft figures for July (USD).
● The US’ Gross Domestic Product Annualised figures for Q2 will be unveiled (USD).
● Finally, Canada will announce its own Gross Domestic Product Annualised figures for Q2 (CAD).
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The Contentworks team