The Acorn #38- Downgrades, Apples and Bears, Oh My!🌳
All you need to understand the market this week
Monday, July 31st 2023
Hi Oak Investors,
Welcome to another recap on the week’s action and events!
At Oak Investing, I look to provide value for all levels of investor, whether it’s pulling together the week’s best articles, insights and breaking news, or clarifying new concepts for beginners.
I hope you enjoy this week’s recap, please get in touch if there’s anything more you’d like to see in The Acorn. If you like what you see, please like, subscribe and share to keep growing the Oak Investor community! 🌳
Thanks,
Gordon
Summary 📝
Markets finished heavily in the red last week as Apple earnings disappointed, and ratings agency Fitch downgraded US debt.
The S&P 500 fell 2.4%, NASDAQ fell 3%, and the Dow Jones Industrial Average dropped 1.1%.
The Volatility Index soared as surprise declines in iPhone sales, and a downgrade in US credit rating from AAA to AA+, spooked investors. Many notable investors, such as Warren Buffett and Jamie Dimon, have suggested this is a nothing story, and doesn’t make a huge difference to where people put their money.
The Fear and Greed index dropped down into the Greed category at 68/100. Again this makes sense given the surprise events of the last week, but do not necessarily mean the end of the recent rally is here. I like the idea of having some cash free to put to work, with the understanding that there may be some near term bumps in the road.
Keep to your strategy, don’t let the noise change your plan, and learn as much as you can!
This Week in History 📰
Provided by The History Place
August 9, 1974 - Effective at noon, Richard M. Nixon resigned the presidency as a result of the Watergate scandal.
August 11-16, 1965 - Six days of riots began in the Watts area of Los Angeles, triggered by an incident between a white member of the California Highway Patrol and an African American motorist.
August 13, 1961 - The Berlin Wall came into existence after the East German government closed the border between east and west sectors of Berlin with barbed wire to discourage emigration to the West.
Major Events This Week 🔬
Economic Events (EST)
Provided by Unusual Whales
Monday
3:00 pm Consumer credit
Tuesday
6:00 am NFIB optimism index
8:15 am Philadelphia Fed President Harker speaks
8:30 am U.S. trade balance
8:30 am Richmond Fed President Barkin speaks
10:00 am U.S. wholesale inventories
Thursday
8:30 am Initial jobless claims
8:30 am Consumer price index
8:30 am Core CPI
8:30 am CPI (year-over-year)
8:30 am Core CPI (year-over-year)
2:00 pm Treasury budget
Friday
8:30 am Producer price index
8:30 am Core PPI
8:30 am PPI (year-over-year)
8:30 am Core PPI (year-over-year)
10:00 am Consumer sentiment (prelim)
Incoming Earnings Reports
Provided by Earnings Whispers
Notable Upcoming Earnings
Provided by Unusual Whales
Monday
TSN (premarket) Implied move: +/- 5.65% Sector: Consumer Defensive
KKR (premarket) Implied move: +/- 3.74% Sector: Financial Services
PLTR (afterhours) Implied move: +/- 13.32% Sector: Technology
LCID (afterhours) Implied move: +/- 11.56% Sector: Consumer Cyclical
BYND (afterhours) Implied move: +/- 15.99% Sector: Consumer Defensive
Tuesday
LI (premarket) Implied move: +/- 8.66% Sector: Consumer Cyclical
UPS (premarket) Implied move: +/- 5.13% Sector: Industrials
NVAX (premarket) Implied move: +/- 15.59% Sector: Healthcare
DDOG (premarket) Implied move: +/- 8.26% Sector: Technology
LLY (premarket) Implied move: +/- 4.43% Sector: Healthcare
AMC (afterhours) Implied move: +/- 17.71% Sector: Communication Services
RIVN (afterhours) Implied move: +/- 11.46% Sector: Consumer Cyclical
UPST (afterhours) Implied move: +/- 19.96% Sector: Financial Services
LYFT (afterhours) Implied move: +/- 15.63% Sector: Technology
TWLO (afterhours) Implied move: +/- 11.07% Sector: Communication Services
Wednesday
RBLX (premarket) Implied move: +/- 12.17% Sector: Communication Services
WEN (premarket) Implied move: +/- 4.04% Sector: Consumer Cyclical
DIS (afterhours) Implied move: +/- 5.16% Sector: Communication Services
PLUG (afterhours) Implied move: +/- 10.15% Sector: Industrials
TTD (afterhours) Implied move: +/- 9.31% Sector: Technology
Thursday
BABA (premarket) Implied move: +/- 5.76% Sector: Consumer Cyclical
WPM (afterhours) Implied move: +/- 3.00% Sector: Basic Materials
Post of the Week 💌
✅ There are over 3000 billionaires in the world! Some have started from nothing, and some inherited great wealth only to grow it further. The most interesting I find are those who started from humble beginnings, had an idea, and devoted everything to making it a reality. 📈
✅ I’ve pulled together some of the most interesting first jobs that some of these billionaires had. How far they’ve come! 🤯💰
What’s Moving Markets? 🏃♂️
Three stories I’m watching carefully this week. Provided by CNBC
Oil prices surge to 4-month highs after Saudi, Russia output cuts
Oil prices surged Monday to their highest since mid-April, following an attack on a key Russian oil export hub and extended production cuts by OPEC kingpin Saudi Arabia and Russia.
Over the weekend, Ukraine launched a naval drone attack on Russia’s port of Novorossiysk.
Shares of China’s second largest chip foundry Hua Hong jump 13% in Shanghai debut
Hua Hong is China’s second-largest chip foundry after Semiconductor Manufacturing International Corp.
The listing comes as Chinese companies seek to raise capital to ramp up on advanced chip tech as China seeks self reliance amid Washington’s efforts to cut Beijing off from advanced chip tech.
Hua Hong first listed in Hong Kong in 2014. Its Hong Kong-listed shares plummeted 7.4% on Monday.
Vietnam’s EV ownership will see ‘strong growth’ in 2023, says new report
Vietnam’s EV adoption is expected to increase to 13.6% in 2023, from 2.9% a year ago, said BMI Research in a new report.
While EVs only accounted for a small share of the passenger car market in Vietnam, the research company expects a strong growth in 2023.
The growth will stem from increased deliveries of VinFast vehicles as the local EV maker steps up on production throughout 2023, as well as the increased supply of affordable China-made EVs.
Chart of the Week 📈
Provided by Chart of the Day
Prices for used electric vehicles fell by almost 30% between June 2022 and June 2023, according to a recent study by iSeeCars, which analyzed more than 1.8 million cars during that time period to identify which models have the largest price drops. New EV prices fell nearly 20% year over year from their peak of $66,390 in June 2022 due to inventory growth, a study by Kelley Blue Book found.
But don’t rush to buy: Costs are still relatively high, says one analyst. Details on what is behind the falling prices, and why there are reasons for interested car shoppers to be cautious, at the link in bio.
Investor’s Toolkit ⚒️
Unusual Whales- Options Flow and Analysis 🛠
5% off with code OAK2022
SimplyWallSt- Stock Analysis 🛠
5% Discount with code OAK
Want to Work with Me? 📈
If you’d like to take your investing to the next level, there are 3 ways I can help:
Pick up a copy of The Investor’s Blueprint, and learn at your own pace 📚
Book a free discovery call with me, and discuss how you can take a step closer to financial freedom 🏆
Follow me on social media, for daily financial education and market insights. 👏
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Thanks for reading, have a great day!
Gordon
Disclosure ✅
This newsletter provides general information only. Before making any financial or investment decisions, please consult a financial planner to take into account your personal investment objectives, financial situation and individual needs.