Nike Stock Plummets after Backlash over Colin Kaepernick’s “Just Do It” Ad

Nike Stock Plummets after Backlash over Colin Kaepernick’s “Just Do It” Ad

Nike (NYSE: NKE) shares fell significantly Tuesday after announcing that Colin Kaepernick would be one of the athletes featured in the 30th anniversary of their “Just Do It” campaign. The company’s stock price fell from $82.50 at close on Friday to $79.39 at open Tuesday morning.

Kaepernick – one-time quarterback for the San Francisco 49ers – has been the center of controversy since his refusal to stand for the national anthem during games in 2016 in protest of racism and growing police violence.

While not currently a member of any NFL team, Kaepernick is a role model to many and is one of many athletes Nike has signed for the campaign, including Serena Williams, Lebron James, Lacey Baker, Shaquem Griffin, and Odell Beckham Jr.

The “Just Do It” campaign is celebrating its 30th anniversary and has featured numerous celebrity spokespersons over the decades.

Nike’s stock isn’t the only casualty of the controversy. Social media has been abuzz with those attacking the choice and those speaking up in defense of Nike and Kaepernick.

Kaepernick had a previous deal with Nike, signed in 2011, that was set to expire, but the company renegotiated the terms and kept Kaepernick as one of the faces of their campaign despite criticism from opponents of Kaepernick’s methods.

Kaepernick Tweeted Monday about the endorsement, and it has gone viral.

“Believe in something, even if it means sacrificing everything. #JustDoIt”

The response #NikeBoycott has gone viral as well, and people all over the country are posting pictures of Nike products in various states of destruction. Many have threatened to burn their sneakers and destroy all other Nike products.

The call to boycott Nike products has been loud.

But the defenders’ voices are loud as well.

It remains to be seen how the move will impact long-term sales, but since Nike’s demographic is largely young and urban, the move may not be as divisive as many are predicting.

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Coca Cola Buys into Coffee Industry with a $5.1 Million Deal

Coca Cola Buys into Coffee Industry with a $5.1 Million Deal

The Coca-Cola Company (NYSE: KO) announced Friday their plan to acquire global coffee brand Costa Limited from parent company Whitbread PLC.

Costa – an English company founded in 1971 – has become one of the fastest-growing coffee chains in the world and is a competitor for Starbucks in the U.K.

The deal is valued at $5.1 million and would give Coca-Cola a strong coffee platform across Europe, Asia, the Middle East, and Africa.

According to the press release issued by Coca-Cola, “The acquisition will expand the existing Coca-Cola coffee lineup by adding another leading brand and platform. The portfolio already includes the market-leading Georgia brand in Japan, plus coffee products in many other countries.”

With consumer demand for sugary drinks shifting to healthier alternatives, and several states in the U.S. passing legislation limiting access to soft drinks, the move may just be what Coca-Cola needs for long-term survival. While demand for sugary drinks like Coke has decreased in recent years, demand for coffee and gourmet coffee beverages is up worldwide.

The deal gives the Coca-Cola company access to a vast retail chain. Costa currently operates over 4,000 locations, as well as another product for the company to market to restaurants and grocery chains.

Coca-Cola is not the only “junk food” company to make this shift toward healthier products. Pepsi and Nestlé have recently made acquisitions that propelled them into the health food/drink arena as well.

Coca-Cola stock did fall slightly after the press release.

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Trump to Sign Order to Reevaluate Retirement Account Rules

Trump to Sign Order to Reevaluate Retirement Account Rules

President Trump signed an executive order Friday which calls for the reevaluation of the rules surrounding individual retirement accounts like 401ks.

The order, which was signed in North Carolina earlier today, is intended to reduce regulatory hurdles, which prevent small businesses from offering competitive retirement packages as well as look into the mandatory age restrictions currently in place.

A press conference announcing the order was held in Charlotte, North Carolina Friday afternoon. Details of the order were also released by several news agencies.

The order will allow small businesses to band together to offer 401k plans to employees and give tax incentives to small businesses who choose to do so, so that the cost of the offering is manageable to employers who would not otherwise be able to offer such incentives.

In an economy where open positions outnumber eligible candidates, this would be a huge boon for small businesses looking to compete with their larger counterparts.

Besides benefiting employees of small businesses, the order also requires that regulatory bodies reevaluate the age restrictions currently in place on retirement plans.

At present, individuals with 401k plans must begin receiving funds from those accounts at age 70½ . The age was determined by IRS life expectancy tables last updated in 2002. Since then the life expectancy has increased from 77 years in 2002 to 78 1/2 years, according to the Federal Reserve Bank.

The executive order asks the Treasury and Labor Department to study the current restrictions and issue new rules with the above issues in mind, as well as an update to the tables.

If the mandatory age increases, retirees will have the option of leaving their funds in place longer, with the potential for the funds to increase over time.

The new rules would benefit Americans with current employer-offered plans, employees of small businesses who aren’t currently offered employer-funded plans, and small businesses who will be able to offer more competitive packages to potential employees.

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What is the Difference Between the Nasdaq & the Dow?

What is the Difference Between the Nasdaq & the Dow?

Understanding the Difference Between the Nasdaq and the Dow

The Dow and the Nasdaq are the shortened names of two index products used to track the overall performance of the major Wall Street stock markets. The Dow Jones Industrial Average, more commonly known as the Dow or the DJIA, is the second oldest stock market index on Wall Street, dating back to the late 19th century. The Nasdaq refers to the NASDAQ Composite, which dates back to 1985, and it differs from the Dow in terms of the stocks it tracks.

The Dow is the most often cited benchmark index around the world. Nearly every financial news publication reports on the daily value of the Dow, and that value represents the price of one share for each of the 30 companies it tracks. The Nasdaq tracks all the companies listed on the National Association of Security Dealers Automated Quotation system, which is the second most important stock exchange in the world after the New York Stock Exchange. Since the Nasdaq tracks far more stocks than the Dow, the value is represented in a logarithmic scale for ease of comprehension.

The Big Three of Wall Street

Along with the S&P 500, the Dow and the Nasdaq are considered to provide a pulse of what is happening on Wall Street; they are called the Big Three of the financial world, and they serve as a temperature gauge of the stock market.

Investors, traders, analysts, economists, and policymakers pay close attention to the Big Three because they offer a glimpse into the behavior of market participants. If the Big Three show gains three days in a row, international investors will respond accordingly, thus creating a sense of optimism and driving up the value of foreign stock exchanges in London, Frankfurt, Tokyo, Shanghai, and other major financial centers.

Tracking Criteria

One of the reasons the Dow is more closely followed than the Nasdaq is that its 30 components have come to represent the triumph of companies that focus on passing value onto shareholders. As of August 2018, some of these companies included: Apple, Boeing, ExxonMobil, JPMorgan Chase, Microsoft, Nike, Walmart, the Walt Disney Company, and 22 others. At one point, only stocks traded on the New York Stock Exchange were part of the Dow; these days, they also include companies listed on the Nasdaq. The selection of Dow components is determined by a committee, and these choices become blue chip stocks.

There is an inherently American economic success story built into the Dow, but it is also a story of pure capitalism. Once a stock no longer fits the Dow blue chip criteria, it is replaced; such has been the case with AT&T, AIG and General Electric.

As a composite index, the Nasdaq is heavily represented by technology companies. Microsoft, for example, is listed on both indices. In essence, the Nasdaq represents about half of the stocks that trade on Wall Street; its high technology volume made this index skyrocket during the Dot-Com Bubble period of the late 1990s.

Both Dow and Nasdaq are used by investment banking firms and portfolio managers to offer financial products such as index and exchange-traded funds. Investors looking for an easy way to diversify their portfolios can take advantage of these index-based products since they are easy to acquire, understand and follow.

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Robinhood Introduces Global Stocks

Robinhood Introduces Global Stocks

Robinhood has made a name for itself in the investment world by offering free trades on its easy to use app, but until recently, those trades were limited to companies traded on U.S. exchanges. Recently, however, the app has begun offering more and more options.

The company announced Tuesday that they are rolling out ADRs (American Depository Receipts) offering investors the opportunity to invest in over 250 global companies – still with no fees.

For now, the ADRs will be limited to companies trading in Canada, Japan, China, Germany, and the U.K., with French companies to follow in the coming months.

ADRs allow American investors to buy shares in U.S. dollars of stocks traded on foreign exchanges. ADRs are still subject to capital gains and still pay dividends, and the exchange rate is accounted for in the trade.

This expansion by Robinhood, especially on the heels of their opening up cryptocurrency and after-hours trading, should help to keep Robinhood competitive with other brokers. J.P Morgan is set to release their no-fee trading app later this week, and Fidelity recently began offering no-fee index funds.

As new, younger investors become the primary target for brokerage firms, demands for lower fees and better service are driving traditional brokers to change their tactics and opening the playing field ¬- giving new services like Robinhood a chance to enter the game.

The app has grown significantly since its release three years ago, and the creators have made no secret about their plans to take on full-service brokerage firms in the future. Robinhood will have to continue expanding their services if they hope to keep up with the big firms now that they too have started offering no-fee trades.

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