As Rio 2016 Olympics starts, Fortune names 5 ‘must-watch’ stocks

Brazil turns into an advertising Mecca in the next two weeks
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Rio 2016 Olympics
A woman rides her bicycle as she passes over a painting of the Olympic rings ahead of the Rio 2016 Olympic games near Barra da Tijuca beach in Rio de Janeiro, Brazil, July 27, 2016. Reuters/Sergio Moraes

Not all eyes are monitoring the scoreboards of the 2016 Olympic Games in Brazil. Some spectators of the global sporting event are keeping a close eye on the stock market. As 11,000 athletes across the globe troop to Rio de Janeiro to compete for an Olympic medal, investors watch closely out how advertising during the Olympics affects the stock market.

According to Fortune magazine, the Olympics Games event is an advertising extravaganza for global companies aiming to promote their brands while the world’s eyes – at least those belonging to sports fans – fly to the host country or follow the sporting event on television.

“Most companies use this association with the Olympics to make consumers more open to their brands. Other companies, though, are using the Rio Olympics to launch exciting new products on the global stage,” Fortune said.

And judging from the behaviour of the stock market during the previous Olympic Games, Fortune magazine has advised investors to monitor these stocks during the two-week sporting event:

  1. McDonald’s (NYSE:MCD), as an official sponsor of the Olympics, has the rights to use the Olympics brand in its global marketing campaigns. In the past four summer Olympics, Fortune magazine noted that shares of McDonald’s have beaten the MSCI Index, a collection of global stocks. The fast-food giant has also beaten the benchmark even after the Olympic Games have finished.
  2. Nike (NSYE:NKE) remains a sporting industry giant all throughout the year, especially during the Olympic Games. Fortune magazine said there is reason to closely watch the stock during the Olympics as Nike tends to launch sporting innovations during the event. Nike’s stock even outperformed the S&P 500 for the duration of the two recent Olympic Games.
  3. Multimedia company Comcast (NYSE: CMCSA) is expected to make billions from ad sales during the Olympics after it won the rights to stream the Olympic Games until 2020 via NBC. In a disclosure, Comcast has already surpassed US$1 billion (AU$1.3 billion) in national ad sales for the Rio 2016 Olympics as early as late March.
  4. Credit card company Visa (NYSE:V) is another stock to closely monitor, according to Fortune. The exclusive payment provider for the Rio 2016 Olympics has given Visa payment rings to its 45 sponsored athletes, including four-time Olympic gold medalist Missy Franklin.
  5. Under Armour (NSYE:UA), may not be an official sponsor of the Olympic Games, but its brand is visible in the uniforms of the American gymnastics team, and recently on the custom pair of shoes it created for Olympic gold-medalist Michael Phelps. Relatively weak compared to Nike, Under Amour hopes to use the Olympic Games as an event to boost its company’s global presence and popularity.

The 2016 Summer Olympic Games run from Aug. 5 to 21.  More than 11,000 athletes are competing for supremacy in the 28 Olympic sports events. The world-famous Maracanã Stadium will serve as the venue of the opening and closing ceremonies of the Rio 2016 Olympics.