Affirm (NASDAQ:AFRM)
Affirm (NASDAQ:AFRM) stock fluctuated widely on Monday, beginning up 1.6% and closing down 5.1% at 10:40 AM EDT. Affirm stock was down 1.64% to $18.59 at closing.
By the close of trading, the Dow Jones Industrial Average had lost 94 points (0.3%), the S&P 500 had lost 27 points (0.8%), and the Nasdaq had lost 110 points (1%).
What’s the Reason?
It’s unclear what caused Monday’s “buy now, pay later” Affirm stock to drop. Instead, it was a symptom of the broader market gloom on Monday, as investors likely braced for a hectic week ahead.
This week, Affirm (NASDAQ:AFRM) will begin reporting financial results for the third quarter. And major financial institutions such as JPMorgan Chase, Citigroup, and Wells Fargo also report this week. Given the situation of the economy, modest expectations may be warranted, with the big banks serving as a harbinger for the market.
In an interview published on Monday, Jamie Dimon, CEO of JPMorgan Chase, said he expects the economy to enter a recession around the middle of next year and that the S&P 500 may fall by another 20%.
What’s Next?
The September Consumer Price Index (CPI) will be released Thursday, making it another major story this week. When the Federal Reserve announces the results of its interest rate rises, Affirm stock investors will be looking to see whether the increases have affected inflation. The Federal Reserve’s interest rate decision at its November meeting will be heavily influenced by the data it produces.
Affirm is a payment stock. Hence Affirm stock price is highly responsive to changes in the consumer price index. The personal savings rate in August was the lowest since 2008, directly resulting from rising prices. As a result, consumers will have less money to spend on discretionary items, which will drag down payment stock prices.
On November 9, Affirm (NASDAQ:AFRM) will release its quarterly earnings report. A better understanding of inflation, interest rates, and their impact on the economy are necessary before Affirm stock investors make any moves.
Featured Image- Megapixl @ Timonschneider
Author Shariq Khan 
