Why is daily reading of the News Important, when wanting to Invest?

All markets including the stock market are affected by the news cycle. This news does not have to pertain to just the financial sector - it can be any news about war, famine, a natural disaster that’s occurred or anything else that affects the general stability of the world, as this then affects stock prices, and especially the sector the news affects the most. 

Reading the news is so important when investing, especially if you’re not using a financial advisor, as it enables you to learn about the stock market quickly and how the news affects it. Personally this is how I became a successful financial advisor!

Even if you don’t read the news religiously you should still have a good idea as to what’s happening in the world as the global  stock markets are linked inextricably to one another and the global news.

What news should you follow?

It’s a good idea to stay in touch with everything and to get into the habit of reading what is happening both globally and locally. By keeping your finger on the pulse of what’s happening you’ll be able to pick up on patterns that affect the stock market and within particular sectors.

Keep an eye on:

• grocery prices at the supermarket
• the Federal Reserve Bureau (FRB)
• the government (decisions they’re making and anything that comes out of the presidents office and senates' house)

For example, whenever oil rich countries (OPEC) have a meeting and decide on oil prices, this affects the energy sector. 

Oil rich countries are a monopoly and as oil prices increase, the energy sector does well. 

Here are a couple of other examples of recent news events affecting the stock markets:

• Barbie - due to the success of the movie, which has generated revenue of over $1billion, we may see an increase in the stock price of the parent company (Mattel), as it may see an increase of merchandise sales. Keeping an eye on the next earnings report which will be released in October 2023 will show whether the company has done well from the Barbie movie.
• Meta - the parent company of Facebook and Threads saw its share prices soar when the new Threads app garnered 30 million sign ups within the first day. We are yet to see if Threads has the ability to keep these new users and whether it’ll be a success. 

Making a Watchlist

You can create a Watchlist of companies you want to follow on platforms including Google and Yahoo Finance. Set yourself up a free account quickly and easily and choose some companies who you want to follow a particular stock.

When you see a company’s Earnings Report and are able to analyze it properly you’ll be able to get a good idea as to whether the company is doing well. This, in conjunction with keeping an eye on what’s happening in the news with the company and what the stock price has done over the past 6 months, will put you in a good position to make a decision whether to invest.

How I’ve made money from the News recently

I don’t typically invest in Meta as a long term strategy, but I knew that Threads had a good launch and so I decided to short-term invest in Meta and pull in some cash the same day because of the rise in the stock price.

You too can follow these companies and make money! Simply by following the news and keeping your finger on the pulse as to what’s happening.

But is it really that simple?

Any company I choose to invest in, I study the company’s financial statements from the past 6 months (which are publicly available as they’re publicly traded companies). It’s mandatory to see the health of the company’s finances before you make any investment in them! Don’t follow trends and advice from other people without doing your own due diligence.

Here’s an example of when youtube influencers affected stock prices and ended up getting into a lot of trouble for it.