🚢 Red Sea rerouted

…and VR sales slide

Troubled waters (Ahmed Gomaa/Getty Images)

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Yesterday's Market Moves   Dow Jones 37,558 (+0.68%) S&P 500 4,768 (+0.59%) Nasdaq 15,003 (+0.66%) Bitcoin $42,328 (-0.76%) Dow Jones 37,558 (+0.68%) S&P 500 4,768 (+0.59%) Nasdaq 15,003 (+0.66%) Bitcoin $42,328 (-0.76%)

Hey Snackers, Close the blinds: an owl that broke out of the Central Park Zoo has turned peeper, landing on windowsills and gawking into Manhattan apartments. Efforts to recapture Flaco, a Eurasian eagle owl with a 6-foot wingspan, were abandoned after he was seen chowing down on rats. Stocks rose yesterday even as Fed officials tried to dampen investors' rate-cut expectations. Indexes have gone green for seven weeks straight, with the Dow closing at a record high for the fifth day in a row.

LONGWAY

Shipping companies reroute around Red Sea attacks, further tying up global supply chains Safety first… To protect their crews and cargo, four out of five of the world's largest shipping cos — including Maersk and Hapag-Lloyd — have adjusted routes or pulled their container ships from the Red Sea, a critical trade corridor that leads to the Suez Canal. The reason: Houthi militants have attacked at least 10 ships in the region, with two new incidents on Monday. (No injuries were reported.) The Houthis say the attacks are in protest of the Israel-Hamas war, and the Suez is just 130 miles from the Gaza Strip. Vital: Roughly 12% of global trade passes through the Suez Canal — or nearly $10B worth of consumer goods, food, and oil every day. Wide berth: Normally about 50 ships cross the Suez daily, but by Monday dozens had opted to go a different way. BP became the first major oil co to say it'd restrict its ships from the trade artery. Rerouting the reroute… Ships transporting goods from Asia to Europe and the US are now facing a double bottleneck: traffic is still restricted through the drought-stricken Panama Canal, which normally handles 5% of world trade. The other option is to go around Africa's Cape of Good Hope, a journey that adds weeks and millions of $$ in fuel costs to every trip. Some ships are taking the scenic route, while others are waiting out the Red Sea tensions. THE TAKEAWAY Countries work together in their best interests… The ultimate cost of the shipping cos' reroutes will depend partly on how long they last (some shipping rates are already up 20%), and several countries are banding together to make the Red Sea safe ASAP. On Monday, the US announced it was creating a task force with the UK, Canada, Bahrain, and six other nations to protect ships. But with Maersk announcing it was going the Cape Hope route, even after the coalition was announced, it's clear some companies would rather keep playing it safe.

Sponsored by Masterworks Picasso's $139 million sale reveals unexpected investment opportunity Just last month, an iconic Picasso painting shattered expectations when it sold for a whopping $139 million at auction. Impressive, considering it was purchased for around $1 million in the late 1960's.  But there's a surprising group of investors also celebrating this sale: 61,000 everyday users of one award-winning investment platform.  Why? Because that platform, called Masterworks, enables anyone to invest in blue-chip paintings by artists like Picasso and Banksy for just a fraction of the cost. When Masterworks sells a painting, investors can get a return.  This way, not only the billionaires of the world can benefit from the art market. Best of all, as a special partner, Snacks readers can skip the waitlist to join here.*

No-Vision

Sales of virtual-reality headsets slide as consumers steer clear of the metaverse Now you see me… Sales of virtual- and augmented-reality goggles have fallen off a digital cliff, sinking nearly 40% this year (after dropping just 2% last year). In the second quarter alone, the overall volume of global VR/AR shipments plummeted 45% on the year. VR demand cooled as thriftier consumers cut back on pricey electronics — including $250 headsets. The shift shows: Off-grid: Google searches for "metaverse" have plummeted 96% since 2021 highs, while searches for "virtual reality" are down 58%. But tech biggies aren't giving up… New reality, mixed results… Meta claims over half of the market share for VR devices, and in October the biz launched its newest Quest 3 headset. But with demand cooling and its Reality Labs division bleeding billions, Meta's been slashing prices. Rival Sony launched its own second-gen VR2 headset this year, but it hasn't taken off. (FYI: it needs the $500 PS5 console to run.) Meanwhile, TikTok parent ByteDance reportedly killed plans for its Pico 5 headset last week after sales of its previous Pico 4 device "fell far short" of expectations. THE TAKEAWAY You can't force the future… Tech giants have spent a fortune trying to make virtual reality our shared reality. But after years of being stuck inside (and with pandemic savings drying up), consumers are choosing IRL experiences over pricey virtual ones. Still, the industry's holding out hope: experts say Apple's new $3.5K Vision Pro mixed-reality headset might get people hyped for AR/VR again, and they're expecting a sales rebound next year.

What else we're Snackin' PayStore: Google will pay $700M after it was accused of overcharging consumers on Google Play. The biz said it'll make it easier to download apps outside its app store following a settlement with US states. StallMart: Buy now, pay later lender Affirm teamed up with Walmart to offer loans at the retailer's self-checkout kiosks. BNPL's staging a comeback, and on Black Friday purchases were up 43% on the year. PhDebt: Student-loan payments started back up in October after a pandemic pause, but 40% of borrowers (9M people) didn't pay. Some said that to make payments they'll have to cut back on essentials. BlueGreen: US lawmakers asked the DOJ to probe Apple for blocking apps like Beeper Mini, which allow Androids to message iPhones through iMessage (#bluebubble). Apple's refused to open iMessage to rivals for years. Bump: Some workers at Tesla's Nevada Gigafactory battery plant will get 10% raises starting next month. The pay bumps could help the EV icon stave off the UAW's unionization efforts at nonunion automakers (like: Tesla). 🍪 Thanks for Snacking with us! Want to share the Snacks? Invite your friends to sign up here.

Snack Fact Of the Day This year, 77% of Americans with a Christmas tree say they're opting for an artificial one Read more

Wednesday Existing-home sales Earnings expected from General Mills, Winnebago, and Micron  Authors of this Snacks own shares of: Alphabet, Apple, and Walmart *Advertiser's disclosure: The content is not intended to provide legal, tax, or investment advice. Past performance is not indicative of future performance. Investing involves risk. Art sales price data and metrics are used for comparative modeling purposes only. Each painting is unique and historical price trends of a group of selected artwork is not a direct proxy for historical price performance of any specific painting or any investment in securities referenced. The example above represents whole art and is not comparative of an investment into our offerings, which includes fees and expenses. See important Reg A disclosures and aggregate advisory performance at masterworks.com/cd.

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