Everything you need to know about their ups and downs
While COVID has touched almost everything in our lives over the past 18 months, there are still plenty of other factors that have influenced the rise and fall of stocks. From court cases to infrastructure bills, there are several sectors whose stocks have recently been through big changes. Here’s what you need to know:
Although airlines were hit particularly badly during 2020, the roll out of COVID vaccines in 2021 has helped many travel stocks recover well. Although in Australia the air travel industry is virtually at a standstill, with no date in sight for state borders to reopen, in the US and Europe, airlines are back in business – and it’s showing in their stocks. The International Air Transport Association has predicted that international travel will be back to normal in 2024, and companies who have heavily cut costs during the pandemic such as Qantas and Flight Centre could be worth looking at when it comes to investing. Morgan Stanley has predicted that although this year Qantas’ capacity will be just 18% of FY19, by next year it will be 55%, and by the following year it will be at 82%, so now could be the time to make some long-term investments.
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If you haven’t considered investing in stocks that tie into the electric vehicle industry, now could be the time. US President Joe Biden has put a US$2 trillion infrastructure bill toward building an electric vehicle charging network, and in Australia, 70 per cent of new cars sold are set to be electric by 2030. We’re well on the way to this target; Australian sales of electric cars have risen at record levels in the past six months. What does this mean in terms of stocks? Look to lithium and battery technology that will be in high demand. The Global X Lithium & Battery Tech ETF (LIT) invests in the full lithium cycle, from mining and refining the metal, through battery production, and is available at eToro.
Artificial Intelligence is going to be huge over the next few years, as America tries its best to overtake China as the new tech leader of the world. In June, the US Senate passed the U.S. Innovation and Competition Act, which is a US$250 billion bill aimed at countering China’s technological ambitions, encouraging semiconductor firms and other manufacturing technologies to open in the states, with cybersecurity and digital transformation expected to be huge in the AI field. You can invest in US tech companies through eToro, with 0% per cent commission.
A recent ruling in the US that Apple can no longer force developers to use in-app purchases means stocks of AppLovin, Zynga, Playtika and Roblox all climbed. The lawsuit was filed by Epic Games, the developer of Fortnite, and the result means that developers are now allowed to include links that take users away from Apple’s store. This allows companies to reduce the cost of their goods, and increase their revenue. While gaming companies will be huge winners in this, expect publishing, entertainment and streaming companies to all benefit too.
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Disclaimer: Investing in stock markets involves the risk of loss.