A photo of different medicinal drugs, tablets and pills on blue background.
1. COVID-19 pandemic and market crash: The most significant event in the past year was the outbreak of the COVID-19 pandemic, resulting in a global market crash. Stock markets across the world experienced rapid declines in value, losing trillions of dollars in market capitalization.
2. Central bank interventions: In response to the economic impact of the pandemic, central banks, including the U.S. Federal Reserve and European Central Bank, implemented aggressive measures such as interest rate cuts, quantitative easing, and other liquidity injections to stabilize markets.
3. Vaccine developments: The announcement of successful COVID-19 vaccines brought optimism, leading to a strong market rally. This sparked a shift in investor sentiment, with stocks of companies in sectors hit hardest by the pandemic, such as travel and hospitality, experiencing significant gains.
4. Tech sector dominance: The tech sector continued to dominate the stock market, with companies like Apple, Amazon, Microsoft, and Google (Alphabet) consistently reaching all-time highs. Many investors turned to these stocks as they benefitted from remote working and increased online activity during lockdowns.
5. Retail investor frenzy: The rise of retail investors, fueled by platforms like Robinhood, led to increased participation and speculation in the stock market. The GameStop saga, where a group of retail investors triggered a short squeeze, garnered significant attention and raised questions about market dynamics.
6. Electric vehicle (EV) revolution: The global stock market witnessed a surge in companies related to electric vehicles and renewable energy. Tesla, in particular, became one of the most valuable companies globally, reflecting the growing investor enthusiasm towards the EV industry.
7. E-commerce growth: As lockdowns restricted physical retail, e-commerce companies experienced a tremendous surge in demand. Giants like Amazon and Alibaba achieved record-breaking sales, leading to substantial stock price appreciation and increased market dominance.
8. Global geopolitical tensions: The intensification of geopolitical tensions, such as the U.S.-China trade war and Brexit negotiations, had a visible impact on markets. Volatility increased as investors reacted to developments, leading to fluctuations in stock prices.
9. Work-from-home trend: The shift to remote work arrangements created opportunities for companies specializing in video conferencing, remote collaboration, and cloud services. Stocks of companies like Zoom Video Communications and Microsoft benefited from this trend.
10. Healthcare sector development: The pandemic accelerated innovation and investment in the healthcare sector. Companies involved in vaccine development, diagnostic testing, and telemedicine experienced significant growth, contributing to stock market performance in this sector.
