What happened
Shares of the e-commerce platform Shopify (SHOP +6.13%) are bouncing back today after plunging 8% yesterday. It appears that some investors are realizing that yesterday's sell-off might have been a bit of an overreaction to Shopify's announcement that it's temporarily suspending operations in Russia and Belarus.
The tech stock was up by 11.5% as of 10:53 a.m. ET.
So what
Yesterday, Shopify released a statement saying that it was "deeply unsettled by the unprovoked attacks and ongoing war in Ukraine" and, as a result, it was temporarily shutting down operations in Russia and Belarus, the two countries that have either directly attacked or facilitated attacks on Ukraine.
Image source: Getty Images.
Shopify also said it "will not collect fees from our Ukrainian merchants and partners" as a way to support people in the country, and that it will also donate funds to Ukrainian humanitarian efforts.
This caused some investors to sell their Shopify stock, likely thinking that not collecting fees in Ukraine and suspending operations in Russia and Belarus could hurt Shopify's financials.
But as fellow Motley Fool writer Rich Smith pointed out yesterday, none of these countries is directly mentioned in Shopify's recent annual report -- which indicates that the amount of money it makes in these countries probably doesn't have a huge impact on its overall business.
With investors likely realizing today that adjusting operations in these three countries probably won't severely hurt the company's financials, many are returning to the stock today.
NASDAQ: SHOP
Key Data Points
Now what
Shopify's share price plunge and subsequent pop today are perfect examples of the broader volatility the market is experiencing right now. As investors process a constant stream of news, some of them are overreacting.
Instead of panicking, investors should keep a long-term perspective with their Shopify stock (and other stocks) and revisit their original investing thesis when they're tempted to trade on the latest news.
