| Good morning. Would never have predicted that merchant marine folk songs, a 79-year-old senator, and GameStop would dominate culture in January 2021...but here we are. | | | |  | NASDAQ | 13,626.06 | - 0.07% | | | | S&P | 3,849.62 | - 0.15% | | | | DOW | 30,937.04 | - 0.07% | | | | GOLD | 1,849.60 | - 0.30% | |  | 10-YR | 1.041% | + 0.80 bps | | | | OIL | 52.75 | - 0.04% | | | *As of market close | - Covid-19 updates: In a day of milestones, the world topped 100 million confirmed coronavirus cases, and the UK surpassed more than 100,000 deaths, the smallest country to hit the mark. The Biden administration said it's ordering 200 million more vaccine doses and speeding up shipments to states.
- Markets: The major indexes didn't move a whole lot yesterday, but today's earnings slate of Facebook, Tesla, and Apple could produce fireworks.
| |  Giphy | If you thought a little school outside Boston liked touting its acceptance rate before...just wait for Class of 2025 stats. Applications for the upcoming fall semester are soaring at elite institutions including Harvard (+42%), Yale (+38%), and NYU (+20%). Princeton is also up 15%. We stan the confidence Many schools are waiving standardized test requirements, and with fewer campus visits possible, students are gravitating toward trusted names. Plus, more applications → more potential acceptances → more opportunity for students to find the best price. Zoom out: Undergrad admissions fell 13% last fall when colleges were presented with a different kind of contagious virus than they were used to. As vaccines roll out, prospective freshmen are expecting more normalcy this fall. - Submissions of the Common Application, a standardized app used by 900+ schools, were up 10% as of Friday.
Not everyone's feeling the love Admissions are down for many regional or less-competitive schools. The State University of New York (SUNY) reported a 20% drop in applications across its 64 campuses, particularly among its 30 community colleges. Applications across California's public university system are down 5%. Common App administrators have also sounded "alarm bells" for students from underrepresented populations. - Financial aid requests were down 11.4% as of Jan. 1, especially from high schools with a higher proportion of low-income, Black, or Hispanic students.
- Applications from first-generation students are down 3%.
Is this a tipping point? If you stare in a mirror and say "college tuition is too high" three times, NYU Prof. Scott Galloway will appear. Last spring, he predicted that, after a short-term dip, top-50 universities would undergo massive expansion...while the rest crumble. S&P Global agrees. The financial data firm issued its fourth consecutive negative outlook for higher ed and said Covid-19 has exacerbated long-running problems around enrollment and revenue. It expects colleges that were previously struggling will fall further behind. Looking ahead...schools will be dealing with Covid in some capacity this fall. President Biden has called on federal agencies to set clearer guidance for reopening. | |  Stephen Brashear/Getty Images | Rosalind "Roz" Brewer is stepping down as the COO of Starbucks and stepping up as the CEO of Walgreens Boots Alliance. Her move is historic: Brewer will be the only Black woman running an S&P 500 company. - As Brewer comes aboard in the spring, Walgreens CEO Stefano Pessina will transition to executive chairman.
The CV: With Brewer, Walgreens is getting a retail vet with a reputation for investing in digital operations. - She joined Starbucks after a five-year stint as the head of Walmart-owned Sam's Club.
- Before that, Brewer worked at Kimberly-Clark, the consumer goods giant. Fun fact: She started there as a chemist.
Brewer is a big loss for Starbucks, which was also forced to replace its CFO this month. Bottom line: Brewer is entering a "plz fix" situation at Walgreens. With the coronavirus taking a sledgehammer to profits, the drugstore chain's stock fell 29.4% last year...even as the broader Dow index gained 7.3%. | | | In his highly anticipated annual letter to CEOs, BlackRock chief Larry Fink called on businesses to reach net-zero emissions by 2050 and do their part to keep global warming in check. Fink can't technically make companies do anything. But like a parent who controls your allowance (in this case, almost $9 trillion in assets), he effectively can. And he has before: - In 2018, Fink wrote that profit isn't everything and companies need to think about their social impact.
- In 2020, he called for prioritizing sustainability and committed BlackRock to factoring climate risks into investment decisions.
Under the latest directive, BlackRock will create a "temperature alignment metric" to assess funds. Like calorie counts on a menu, the goal nudges investors into (environmentally) healthier decisions, DealBook writes. - If companies don't take the carrot, they may meet Fink's stick. Last year, BlackRock put 191 businesses on a watch list and voted against 64 directors and 69 companies for climate-related reasons.
But Fink would argue there's a better reason to play along: "The more your firms are seen to embrace the climate transition and the opportunities it brings, the more the market will reward your firms with higher valuations." | |  | The name of the investment game is (and always has been) diversification. And one tool in the investment-diversification toolbox is Fundrise. Fundrise lets you invest in a low-cost, diversified portfolio of institutional-quality real estate. They combine state-of-the-art technology with in-house expertise to reduce fees and help maximize your long-term return potential. Fundrise can potentially help you take your investment portfolio to higher levels than the high-rises and private real estate you'll be investing in. Their intuitive and easy-to-use platform enables you to closely monitor your investments and provides transparent communications around investment progress. With Fundrise, you don't have to be some ultra-wealthy investor to put your bucks into quality long-term diversified investments. You can access the same quality of investments as the fancy folks with just $500. Get started with Fundrise today. | | | Earnings szn means two things: 1) a CEO's small talk skills being put to the test and 2) offhand remarks that reveal a lot about the current state of the business world. For example… American Express CEO Stephen Squeri is bullish on leisure travel: "...As we get into this summer season, this June, July, August and September, you will see a rush for people to travel, especially air travel." Johnson & Johnson CFO Joseph Wolk on the vaccine the company is developing: "The fact that we do not require significant refrigeration beyond the norm, as well as being one shot, certainly does play into the label that some outside the company have called it a game-changer." GE CEO Larry Culp defending his potential $47 million payout (in a few years, and only if company stock stays above $10 for at least 30 days): "I didn't take a salary last year once Covid hit. I think we all sacrificed." Microsoft CEO Satya Nadella on its blockbuster quarter buoyed by growing demand for video games and cloud computing: "What we have witnessed over the past year is the dawn of a second wave of digital transformation sweeping every company and every industry." | |  Francis Scialabba | Every Wednesday, we're going to take a reader-submitted question about business and the economy and do our best to answer it. Ask your question here. From Miles in Little Rock: Why is the stock market at a record while the economy is tanking? The Brew's answer: Hi Miles, it can definitely be disorienting to see the stock market soaring to all-time highs while millions of Americans are out of work because of the pandemic. Here are four possible explanations for the split screen we're seeing on Wall Street and Main Street. - The stock market is future-looking. Stock prices reflect investors' expectations of how companies will perform not now but later—for example, Tesla is worth more than many automakers combined because of its long-term growth potential. A roaring stock market means investors are betting on a healthy economic recovery.
- The stock market is dominated by huge companies. And many of these huge companies, such as Amazon, Walmart, and Microsoft, benefited financially from the pandemic.
- The economy isn't as bad as we think. Some sectors of the economy, such as manufacturing and the housing market, are posting their best performances in more than a decade.
- The stock market could also be wrong. A number of prominent investors say the stock market is all discombobulated because of the historic stimulus measures deployed by the government.
Hope that helps! And feel free to ask more questions here. | | - The GameStop saga continues: The favorite stock of r/WallStreetBets jumped another 92% (and ~50% after hours), as billionaires including investor Chamath Palihapitiya and Elon Musk tweeted excitedly about the company.
- President Biden signed executive actions around racial equity, including one that would end the DOJ's use of private prisons.
- Verizon Fios suffered major outages yesterday, leaving many East Coasters without internet.
- Beyond Meat stock jumped 18% after it announced a partnership with PepsiCo.
- The CEO of a large Canadian casino company quit after it was discovered that he and his wife traveled to a remote community in the Yukon territory, disguised themselves as motel workers, and tried to get a coronavirus vaccine. The community is home to a large indigenous population.
| | | As Biden's Cabinet goes through the confirmation process, it is our duty to make sure you know the names of the people in charge of our country's top departments. How do we do that? With a little trivia. Can you name Biden's picks for the following positions? - Treasury Secretary
- Secretary of State
- Secretary of Defense
- Secretary of Transportation
- Commerce Secretary
- Secretary of Housing & Urban Development
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Hit the button below to learn more and access your rewards hub. Click to ShareOr copy & paste your referral link to others:
morningbrew.com/daily/r/?kid=8386977e | | | 1. Treasury = Janet Yellen
2. State = Antony Blinken
3. Defense = Gen. Lloyd Austin
4. Transportation = Pete Buttigieg aka Mayor Pete
5. Commerce = Gina Raimondo
6. HUD = Marcia Fudge | | | ** A Note From Stash *The Morning Brew is a paid partner of Stash. Investment advisory services offered by Stash Investments LLC, an SEC registered investment adviser. Investing involves risk and investments may lose value. For more information, please visit www.stash.com. **Promotion is subject to Terms and Conditions. To be eligible to participate in this Promotion and receive the bonus, you must complete the following steps: (i) click through the link above, (ii) successfully open a Stash Invest Account (otherwise known as your personal portfolio) in good standing, (iii) link a funding account (e.g. an external bank account) to your new Stash Invest Account, AND (iv) initiate and complete a deposit of at least five dollars ($5.00) into your Stash Invest Account. ** A Note From Fundrise (Here's all the legal jargon we know you love reading.) | | |
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