Why Coupang Stock Tanked 29% Last Month
Shares of South Korean e-commerce giant Coupang (NYSE: CPNG) crashed 29.1% in January, according to data provided by S&P Global Market Intelligence. The stock market hit a patch of volatility last month, but Coupang was hit especially hard. The catalyst? The threat of rising interest rates.
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Inflation is running hot right now in countries around the world as consumer prices lap their depressed levels from a year ago (before COVID-19 vaccines were widely available). In an attempt to dial the inflation rate down, the Federal Reserve said it will increase its benchmark fed funds short-term interest rate this year, in several steps, likely starting in March. Higher interest rates don't just cool off the economy overall -- they also lower the present values of stocks, especially those of fast-growing businesses.
Source Fool.com
