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Three big dips for your portfolio

This week, we look at three household names that have been big players throughout the pandemic: Bitcoin (BTC), Johnson & Johnson (JNJ) and Peleton (PTON).

➤ Bitcoin (BTC)

➤ Peloton (PTON)

➤ Johnson & Johnson (JNJ)

Bitcoin (BTC)

 

Last week saw the price of bitcoin hit an all-time high reaching $62,000 a coin, meaning the value of bitcoin has risen ten-fold in the space of a year. Bitcoin’s meteoric rise over the last few months has been attributed to several factors from governments’ changing attitudes to interest from institutional investors. 

Despite the dazzling start to the week for the crypto, the tail-end of the week brought a very different story. On Sunday, the crypto recorded its biggest one-day drop, the largest in two months, plummeting to $55,000 a coin – a 15% drop. This latest dip has been attributed to various factors, including Turkey’s central bank banning the use of cryptocurrencies to pay for goods and services and a power outage in China’s Xinjiang region, which powers the brunt of bitcoin mining.

Across the pond, reports that the US Treasury is planning to crack down on money laundering carried out through digital assets impacted the price of the cryptocurrency. US Treasury Secretary Janet Yellen on Monday also warned crypto of being an “extremely inefficient” way to conduct monetary transactions.

Finally, in an interview with Bloomberg, former SEC chairman Harvey Pitt said he expected a “fair amount” of crypto regulation from the Securities and Exchange Commission (SEC)’s new chairman Gary Gensler. Is now the time for wannabe bitcoin investors to buy the dip?

Peloton (PTON)

 

Exercise equipment company Peloton’s latest product, the Tread+, has been flagged as an urgent safety issue by the Consumer Product Safety Commission (CPSC) following 39 incidents including one death, involving the treadmill.

The CPSC issued the warning on Saturday after YouTube footage emerged of a child being dragged under one of the machines. The CPSC said the Tread+ posed “serious risks to children for abrasions, fractures, and death”. 

New York-based Peloton called the news “inaccurate and misleading” and said there was no need to discontinue use but to ensure children and pets were kept away from the device. The news comes after a huge year for the exercise equipment company which saw sales in its products soar amidst lockdowns and closed gyms.

Will news of the Tread+ danger put off the almost cult-like following Peloton has amassed? Will the share price escape unharmed?

Johnson & Johnson (JNJ)

 

The medical company has been in the news after US authorities paused single-dose shots of the Covid-19 vaccination over the rare risk of blood clots. The Centers for Disease Control and Prevention (CDC) and the US Food and Drug Administration recommended pausing the vaccination after six women developed rare but serious blood clots. The setbacks run the risk of damaging the entire vaccination program as confidence in the Johnson & Johnson (J&J) vaccination falters.

President Joe Biden’s chief medical adviser, Dr Antony Fauci, said the shots would return with restrictions and this could be as soon as the end of the week when advisers to the CDC and Prevention meet to discuss the pause in Johnson & Johnson´s single-dose vaccine. Fauci said he doubted that the US would permanently halt the use of the J&J vaccine. 

While the price of Johnson & Johnson shares fell amid the news of the vaccine, shares in competitor medical companies Moderna and AstraZeneca gained. If Fauci is right in his prediction, will the reinstation of the J&J vaccine help the stock bounce and get the vaccination programme back on track?

 

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