Monday, April 22nd 2024
Welcome to another recap on the week’s action and events!
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
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Summary 📝
Last week was a wild one, with volatility rapidly increasing, SPY dropped by a whopping 3.9%, leading to a broadly red market heatmap.
Significant legislative and geopolitical activities (Driven by @UnusualWhales):
The U.S. House passed a bill that could ban TikTok unless ByteDance divests, impacting $META.
Approval of $61 billion in aid for Ukraine by the U.S. House.
Financial analyst Jim Cramer expressed concerns that the market has not yet reached its true bottom on April 19th.
$NVDA witnessed its steepest decline since March 2020.
Congressional and economic indicators:
Representative Felix Moore reported purchasing up to $15k of Bitcoin.
A peak in office vacancies reported.
The median monthly U.S. housing payment climbed to a record $2,747, an 11% increase from last year.
Required average salary for purchasing a median-priced home in the US surged by 45.5% since 2020.
Mortgage rates have risen above 7%.
Fed's Kashkari hinted at maintaining higher rates potentially until 2025.
JPMorgan argued that high interest rates are exacerbating inflation.
International affairs:
Israel conducted airstrikes in Iran on April 18th.
Boeing, $BA, plans to introduce flying cars in Asia by 2030.
Investigations and protests:
A congressional probe revealed Wall Street's investment of American retirement funds in index funds holding blacklisted Chinese companies.
Nine Google employees arrested following protests in New York and Sunnyvale offices, including a livestreamed sit-in.
Economic warnings and climate change:
The IMF alerted the US about the inflationary impacts of its substantial fiscal deficits.
ASML reported lower-than-expected orders, indicating a downturn in demand for advanced machines.
Earth recorded its warmest March, surpassing last year's records.
Market Summary
S&P 500 SPY 0.00%↑-3.6%
NASDAQ QQQ 0.00%↑-6.1%
Dow Jones Industrial Average DJIA 0.00%↑-0.3%
VIX Volatility Index +13.8%
At present, markets are pricing in a 98.3% chance of no change in rates at the next Fed meeting in early May, with a small 1.7% chance of a hike by 25BPS.
The Fear and Greed index slipped down to the Fear category at 32/100.
I’m hoping that this pullback is part of a healthy cycle in the market, with investors taking profits after months of positivity, with upcoming earnings offering an opportunity to get back into the market with the cash currently waiting on the side-lines!
As always, stick to your strategy, and make sure your money is working as hard as you are!
This Week in History 📰
Source- The History Place
April 26, 1994 - Multiracial elections were held for the first time in the history of South Africa.
April 28, 1789 - On board the British ship Bounty, Fletcher Christian led a mutiny against Captain William Bligh, setting him and 18 loyal crew members adrift in a 23-foot open boat.
April 29, 1992 - Riots erupted in Los Angeles following the announcement that a jury in Simi Valley, California, had failed to convict four Los Angeles police officers accused in the videotaped beating of an African American man.
What’s on my Watchlist? 👀
Three stocks I think have an interesting week ahead.
As always, earnings season with tech companies is likely to be an interesting time. With volatility in mind, I’ll be keeping my eye on TSLA 0.00%↑ META 0.00%↑ and GOOGL 0.00%↑ amongst others!
Major Events This Week 🔬
Incoming Earnings Reports
Source- Savvy Trade
Earnings Expectations (Driven by Unusual Whales)
Catalyst Watch 🔥
Source- Seeking Alpha.
Monday - April 22
Volatility watch - Options trading volume is elevated on Snap (SNAP) and Summit Therapeutics (SMMT). Short interest moved even higher over the last week on B Riley Financial (RILY) and Beyond Meat (BYND). The most overbought stocks per their 14-day relative strength index include Macatawa Bank (MCBC), Coupang (CPNG), and Alpine Immune (ALPN). The most oversold stocks per their 14-day Relative Strength Index include Sunoco (SUN), Capri Holdings (CPRI), and Perion (PERI). The Tapestry (TPR)-Capri Holdings (CPRI) deal is at risk of being blocked.
All week - The TotalEnergies (TTE) board is expected to decide if a resolution to split the roles of CEO and chairman will be included at the annual general meeting in May. A group of investors has said the move could accelerate the company's shift away from fossil fuels.
All week - The World Energy Conference in Rotterdam will include talks by Saudi Aramco (ARMCO) CEO Amin Nasser and TotalEnergies (TTE) CEO Patrick Pouyanne.
Earnings watch - Notable companies due to report include Verizon (VZ), Truist (TFC), and Albertsons Companies (ACI).
All day - WTI crude May futures will expire. Crude oil futures (CL1:COM) have seen extra volatility over the last year on contract expiration dates.
All day - The crypto world will have its eyes on the three-day World Blockchain Summit in Dubai.
Tuesday - April 23
Earnings watch - Notable companies due to report include Visa (V), Tesla (TSLA), PepsiCo (PEP), Texas Instruments (TXN), Philip Morris International (PM), Mattel (MAT), UPS (UPS), Lockheed Martin (LMT), and General Motors (GM). Options trading implies a sizable share price swing for JetBlue Airways (JBLU) and Invesco (IVZ) after their reports are released.
All day - The Maxim Group LLC International Mining & Processing Conference will include detailed analysis of the mining and processing sectors. Aqua Metals (AQMS), Austin Gold (AUST), Anson Resources (OTCQB:ANSNF), McEwen Mining (MUX), and Novonix (NVX) are some of the companies due to appear.
All day - The Stripe Sessions Conference will include talks by Stripe (STRIP) CEO Patrick Collison, Nvidia (NVDA) CEO Jensen Huang, Instacart (CART) CEO Fidji Simo, and Urban Outfitters (URBN) CTO Dave Hayne.
All day - My Size (MYSZ) will begin trading on a split-adjusted basis following the company's 1-for-8 reverse stock split.
8:30 a.m. General Motors (GM) will hold its earnings conference call. The Detroit automaker's update on electric vehicle production plans and capital allocation strategy will be closely watched.
8:30 a.m. Cleveland-Cliffs (CLF) will hold its earnings call amid merger speculation involving US Steel (X) and Nippon Steel (OTCPK:NISTF).
9:45 a.m. S&P Global will release the latest U.S. PMI composite flash report.
10:00 a.m. The U.S. Bureau of Census will release the March New Home Sales report.
5:00 p.m. Tesla (TSLA) is scheduled to hold its earnings conference call. Key topics will be the outlook for full-year deliveries, pricing, and additional color on the robotaxi event in August. Analysts are likely to try to pin down Elon Musk on the status of the mass-market Model 2 launch. Options trading on Tesla implies a 10% share price swing after the report drops. Tesla fell 12% immediately after its Q4 earnings report. EV stocks with the tightest trading correlation to Tesla after earnings are Faraday Future Intelligent (FFIE) and Nio (NIO).
Wednesday - April 24
Earnings watch - Notable companies due to report include Meta Platforms (META), IBM (IBM), AT&T (T), Boeing (BA), Chipotle (CMG), General Dynamics (GD), Hilton Worldwide (HLT), and Ford Motor (F). Options trading implies a double-digit share price swing for Hasbro (HAS) and Sleep Number (SNBR) after their reports.
All day - Nasdaq will release its latest report on short interest positions.
All day - Volkswagen (OTCPK:VLKAF) will hold its China Capital Markets Day in Beijing. Management from the regional brands will showcase their respective product strategies for China, followed by deep dives highlighting technologies and partnerships.
10:30 a.m. Boeing (BA) will hold its earnings conference call. Investors will be watching for any production updates and to see if the recent guidance for "low single digit billions" full-year free cash flow is reiterated.
4:15 p.m. The launch window opens for a Rocket Lab (RKLB) Electron rocket that will carry a pair of satellites on behalf of NASA and the Korea Advanced Institute of Science and Technology.
Thursday - April 25
Earnings watch - Notable companies due to report include Microsoft (MSFT), Alphabet (GOOG), Merck (MRK), Caterpillar (CAT), Comcast (CMCSA), Intel (INTC), and Altria Group (MO). Options trading implies double-digit share price swings for Snap (SNAP) and Hertz Global (HTZ) after their reports.
All day - Notable events include annual meetings for Texas Instruments (TXN), Johnson & Johnson (JNJ), and Pfizer (PFE).
All day - The Beijing Auto Show Auto China 2024 will begin. Some of the automakers that are expected to make a splash with new models include Nio (NIO), BYD Company (OTCPK:BYDDF), Mercedes-Benz (OTCPK:MBGAF), BMW (OTCPK:BMWYY), Zeekr, and General Motors' (GM) Cadillac.
Friday - April 26
Earnings watch - Notable companies due to report include TotalEnergies (TTE), Exxon Mobil (XOM), Abbvie (ABBV), Chevron (CVX), and Colgate-Palmolive (CL).
8:30 a.m. The core PCE price index report for March will be released. Economists forecast the index will rise +2.7% year-over-year vs. +2.8% in February and +2.9% in January. The inflation gauge is seen rising 0.3% month-over-month for March to match the pace in February.
10:00 a.m. The latest report on consumer sentiment will be released by the University of Michigan.
Seeking Alpha Editor Josh Fineman contributed to this story.
Chart of the Week 📈
Source- Chart of the Day
Bitcoin rose above $64,000 at one point on Friday, rebounding from a drop below the $60,000 mark, as the cryptocurrency continues to experience volatility ahead of the upcoming halving event.
The upcoming halving is slated to take place this week. This is when the rewards for bitcoin miners are slashed in half. Halving happens every four years and is written in the code of the bitcoin blockchain. The result is a slowing supply of bitcoin into the market.
In prior bitcoin cycles, the halving preceded a bull run for the cryptocurrency.
Post of the Week 💌
Source- Oak Investing
❗️Bitcoin Halving Explained 💡👇
➡️ Follow @oakinvesting for daily investing content. 📆
✅ The crypto market, much like the stock market, is driven by trends where new technologies capture investor attention and then quickly shift. 📈📉
✅ With the upcoming Bitcoin Halving, this could be a crucial trend shift as the reward for mining new Bitcoin blocks is cut in half. This event has historically influenced prices by reducing the new supply of Bitcoin, potentially increasing its value if demand remains stable. 🌍💼
👀 Are you ready for the Bitcoin Halving? Do you think it will affect your investment strategy?
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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.
So much info! Can't believe it's free, thanks Gordon.