By Philip van Doorn
Also, more drama at New York Community Bancorp and a breakdown of how much money you need to buy a home with a 7% mortgage
China has long dominated the world market for rare earth minerals, which are required components of many devices, including the one on which you are reading this article.
This week Myra P. Saefong reported on how the global market for rare earth minerals has been changing, with China becoming less dominant, and highlighted the opportunity for investors to take advantage of this profound market shift.
NYCB saga continues
Late on Thursday, New York Community Bancorp (NYCB) announced that Alessandro DiNello, who was named the bank’s chairman early in February, would take over as CEO after Thomas Cangemi resigned.
But what really surprised investors was that the the bank also said it had identified “material weaknesses” in its loan-review processes.
NYCB followed up on Friday by announcing the hiring of George F. Buchanan III as vice president and chief risk officer and Colleen McCullum as the company’s chief audit executive.
This story has continued to develop since Jan. 31, when NYCB surprised investors by cutting its dividend and reporting a fourth-quarter net loss as it built up reserves to cover potential losses in its commercial real estate and multifamily residential loan portfolios.
DiNello was formerly CEO of Flagstar Bancorp of Troy, Mich., which New York Community Bancorp acquired in December 2022. New York Community also purchased deposits and loans from the failed Signature Bank of New York in March 2023 through a transaction arranged by the Federal Deposit Insurance Corp.
The two acquisitions brought NYCB’s total assets up to $116.3 billion as of Dec. 31 from $59.6 billion two years earlier. Passing the $100-billion threshold means the bank must begin submitting annual capital plans to the Federal Reserve this year.
NYCB’s share price had already fallen 53% for 2024 through Thursday. The stock was down another 24% in afternoon trading Friday.
An obvious question now is whether or not it is time for New York Community Bancorp’s board of directors to sell the bank. Citigroup analyst Keith Horowitz believes NYCB will have to solve its problems “on its own.”
Read on: Regional bank stocks dragged down by NYCB, led by banks with exposure to New York City real estate
Something you might not know about Nvidia
Last week Nvidia Corp. (NVDA) made the biggest splash related to artificial intelligence with another blowout quarter for sales and earnings. This week, Jeremy Owens used information provided by the Dow Jones Market Data team to show that what Nvidia accomplished financially over the previous year had never been done before.
Nvidia was among the subjects covered in this week’s On Watch podcast.
More: Nvidia’s stock sees one advantage that only two other chip makers share
AI and real estate
With so much coverage of the woeful state of office buildings with high vacancy rates, it is good to be reminded that there are pockets of opportunity in commercial real estate. Joy Wiltermuth reported on “a new gold rush” in the CRE market, driven by AI.
AI news
This week Snowflake (SNOW), a cloud services provider, illustrated the importance of looking ahead. The stock fell 18% on Thursday after Snowflake surprised the market with a CEO change. But what might have upset investors more was that the company’s revenue projection was lower than what analysts had expected.
Read: Snowflake could stay in the ‘penalty box’
More tech news and opinion:
AMD is worth $300 billion for the first time. These stats show its dramatic rise.Look out, Super Micro – Dell is cementing itself as an AI play tooDell’s big quarter, fueled by surge in AI-server demand, sends stock soaring 19%Will Apple create a better AI? Questions abound as Tim Cook hints at what’s to come.AI momentum is underpriced in the options market, says Bank of AmericaChief AI officer – A necessity for companies or an expensive impediment?Zscaler earnings top expectations, but the cybersecurity stock falls
A non-tech winner: Beauty vs. the AI beast – this beat Nvidia over a five-year period
A new competitor in the weight-loss drug space takes action after its stock pops
Shares of Viking Therapeutics Inc. (VKTX) more than doubled after the company announced positive results from a Phase 2 trial of its weight-loss drug VK2735, a GLP-1 receptor agonist that will potentially compete with Ozempic and Wegovy, which are made by Novo Nordisk A/S (NVO), and Mounjaro, which is made by Eli Lilly & Co. (LLY).
A positive “binary event” for a company that hasn’t yet reported any revenue or profit makes Viking Therapeutics an obvious takeover target.
Then again, any such move got more expensive this week. Viking made use of investors’ enthusiasm by issuing 6.47 million new shares on Wednesday, as Ciara Linnane reported.
About those “Magnificent Seven” stock market concentration warnings…
Alarms have been raised about the “Magnificent Seven,” companies – Microsoft Corp. (MSFT), Apple Inc. (AAPL), Nvidia, Amazon.com Inc. (AMZN), Meta Platforms Inc. (META), Alphabet Inc. (GOOGL) and Tesla Inc. (TSLA) – making up a huge percentage of the U.S. stock market. The portfolio of the $500 billion SPDR S&P 500 ETF Trust SPY is 29% concentrated in these companies.
But Steve Goldstein reported that the U.S. actually has one of the least concentrated stock markets in the world.
More stock-market coverage:
Are U.S. stocks in a bubble? History says no.Trump’s return to the White House could boost these stock-market sectors – while undercutting othersWhy the stock market ‘doesn’t look very bubbly’ to Ray Dalio right now
How much money do you need to buy a $400,000 home?
Aarthi Swaminathan breaks down the numbers and provides tips to buyers: This is how much money you need to purchase a $400,000 home with a 7% mortgage.
More housing coverage and advice:
What $1 million buys in the world’s most expensive real-estate marketsI’m losing money on my rental property, which has a $420,000 mortgage and a 7.9% interest rate. Should I sell?
The bitcoin surge
Bitcoin (BTCUSD) traded north of $64,000 on Wednesday. Through Thursday, the virtual currency’s price was up 46% for 2024 to $61,429.
In the Distributed Ledger column, Frances Yue explained the differences between the 2024 bitcoin rally and the cryptocurrency’s record run in 2021.
Want more from MarketWatch? Sign up for this and other newsletters to get the latest news and advice on personal finance and investing.
-Philip van Doorn
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
03-01-24 1252ET
Copyright (c) 2024 Dow Jones & Company, Inc.
