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Elon Musk tweet about Signal messaging app sent stock with same name flying

Dion Rabouin, author of Markets
Data; FactSet; Chart: Axios Visuals

The surge in Texas health care company Signal Advance continued on Monday as the stock rose by 438%, after previously gaining 1800% during one 24-hour period.

The catalyst: A Thursday tweet from Tesla CEO Elon Musk that said simply, “Use Signal.” Musk was recommending the encrypted messaging service (an independent 501c3) that competes with Facebook's WhatsApp, but a frenzy ensued in Signal Advance (SIGL) nonetheless that has continued for days.

By the numbers: The company's market cap has risen from around $7 million last week to more than $659 million as of Monday's close, according to FactSet.

The bottom line: Strategists think this may be another sign of the overall mania in stock prices. BofA's chief investment strategist Michael Hartnett notes cynically, extreme asset bubbles have been the "natural end to nihilistic bull markets of [the] past decade."

  • This one is unlikely to be different, GMO's Grantham writes. "The combination of timing uncertainty and rapidly accelerating regret on the part of clients means that the career and business risk of fighting the bubble is too great for large commercial enterprises."
  • "They can never put their full weight behind bearish advice even if the P/E goes to 65x as it did in Japan."

Go deeper

Dion Rabouin, author of Markets
Jan 12, 2021 - Economy & Business

The big hedge

Illustration: Aïda Amer/Axios

Warnings that the U.S. equity market looks to be in a bubble are coming from a slew of Wall Street asset managers and strategists as stocks continue to reach new record highs and markets display abnormal behavior. But data show that while investors are hedging their bets, there is hardly a mad dash to sell out of equity positions.

What's happening: As the 10-year Treasury yield rises solidly above 1% — its highest level in nearly a year — a growing contingent of investors fear that a crash is imminent without the ballast of rock-bottom interest rates.

Go deeper (1 min. read)Arrow
Dion Rabouin, author of Markets
Jan 12, 2021 - Economy & Business

Twitter's stock slump is about more than banning Trump

Data: FactSet; Chart: Axios Visuals

Twitter shares fell by as much as 12% on Monday after the company announced it had permanently banned President Trump's account.

Between the lines: While many were quick to say the decline was blowback for the company's decision, the performance of other social media companies' stock prices suggests there's more to the story.

Go deeper (1 min. read)Arrow
Kyle Daly, Sara Fischer
Jan 12, 2021 - Technology

The online far right is moving underground

Data: Apptopia; Chart: Axios Visuals

The online purge of far-right figures and platforms that followed last week's Capitol insurrection looks to be driving radicalized users into darker corners of the internet.

What's happening: Downloads have surged for messaging apps that are securely encrypted or designed to cater specifically to the ultra-conservative user.

Go deeper (2 min. read)Arrow