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The S&P 500 set new all-time record highs in 2021, with $8.6 trillion worth of value created that year alone! It was an eventful 12 months for US investors–from record-breaking bull markets right up until China cracked down on some of its biggest companies which sent stocks into a tailspin known as “the trade war.”
The S&P 500 has broken its own record for most times closing at 68th time this year, continuing a steady march higher that helped push it to fresh all-time highs. Put another way: on nearly 30% of trading days in 2021, the benchmark reached new heights and broke through previous records!
Meme Mania 2021
Meme mania has taken over the world of finance this year. Retail traders were flush with cash and trapped at home due to a pandemic, so they started supercharging meme stocks on social media platforms like Facebook or Twitter where people met up for chats about what’s hot in pop culture these days as well memes that might be related (i think). GameStop Corp rose 1,200%, while AMC Entertainment skyrocketed more than 700% – not bad considering both companies had been struggling before all those talkative users took them under their wings!
Retail favorites such as ContextLogic Inc., Clover Health Investments Corp., and Workhorse Group Inc all found themselves down more than 70% this year as investor enthusiasm faded.
Archegos Capital Management Collapse
The collapse of Bill Hwang’s Archegos Capital Management had a cascade effect from their forced liquidations impacted stocks such as ViacomCBS Inc., Discovery inc., VIPShopholdings Ltd., Tencent Music Entertainment Group–all plunging more than 30% over a week due to banks rushing in with billions worth of exposure during this time period
Record High IPOS in 2021
The public markets saw a record number of initial public offerings in 2021, with nearly 1,110 companies raising roughly $337 billion. Electric pickup maker Rivian Automotive Inc led all U.S.-based IPOs and raised the 12th largest IPO across all exchanges – surpassing South Korean e-commerce giant Coupang which came second at 4.6B USD. There is no doubt that this explosion will continue as blockchain technology continues its adoption rate into everyday life for years to come.
Didi Global Inc., one of China’s most prominent ride-hailing companies, has become the butt of many jokes over its poor investor success. The company’s debut on Wall Street was particularly disastrous as it raised $4.4 billion and now sits with a market cap at just under half that amount after consecutive quarters’ losses left their share price virtually unchanged since July 2017.
The 2021 China Crackdown
China’s stock market has been in a tailspin ever since the beginning of this year. The Nasdaq Golden Dragon China Index fell 44% as regulators mounted an assault on corporate America that left many companies restructured or folded entirely, including those related to education and technology stocks like Tal Education Group Inc., New Oriental Education & Technology Grp INC, Dianping (a food delivery app). The selloff is just one example among countless others across industries around the globe who were hit hard during what some analysts refer called “the greatest selloff”—a microcosm for how things played out globally.