"I’ve Got the Power!"

Hi There! We did it again! Last week, Grenada secured its second medal at the Paris 2024 Olympics games, thanks to none other than the strong man himself, Anderson Peters. With an incredible javelin throw of 88.5m, Anderson clinched third place, earning his country a Bronze Medal.

Anderson Peters perfectly represents the spirit of Grenada. His determination and success show us all what can be achieved when talent is combined with relentless effort. His achievement inspires us and elevates our nation’s standing in the global arena.

To say every Grenadian at home and in the diaspora is elated would be an understatement. We are beyond proud!

Alright, let’s dig in!

Last Week Recap

Last week was nothing short of a rollercoaster for the markets. U.S. stocks held on tight, managing to limit weekly losses to modest declines despite a series of sharp sell-offs. The global markets weren’t as lucky, with recession fears and the unwinding of the yen carry trade pushing stocks into a steep slide. Yet, the equity markets didn’t go down without a fight, staging strong rallies last Tuesday and Thursday. Meanwhile, Treasury yields edged higher as investors returned to riskier assets, though Treasury auctions disappointed. In the commodities market, crude oil rebounded from a seven-month low last Monday, securing its first weekly gain in five weeks.

U.S. Markets

• Equities: U.S. stocks had a volatile week, with the market experiencing both its worst and best days of the year. Despite the turbulence, the market managed to recover much of its losses by the end of the week. Eli Lilly stood out as a top performer, continuing to rise on the back of strong sales reports for its weight loss drugs, Mounjaro and Zepbound.

• Fixed Income: The Bloomberg U.S. Aggregate Bond Index dipped as bond markets mirrored the choppy equity sessions. Treasury yields ended the week higher, with the 10-year yield up three basis points and the 2-year yield climbing seven basis points. Early in the week, the longest yield curve inversion in U.S. history briefly ended, though the spread remains inverted. The week also saw disappointing Treasury auctions, with the 10-year and 30-year auctions performing poorly.

• Commodities: The Bloomberg Commodities Index rose by nearly 0.9% as oil prices swung wildly. West Texas Intermediate (WTI) crude oil hit a seven-month low on Monday but rebounded later in the week, closing up by 4.3%. This marked its first weekly gain in five weeks, driven by declining U.S. crude inventories and ongoing tensions in the Middle East. Gold remained steady, benefiting from a dip in Treasury yields, while silver, platinum, and copper all saw declines.

Currencies:

• Japanese Yen: The yen took center stage last week, weakening against the dollar as the yen carry trade unwound. This led to the yen's first weekly drop in six weeks.

• U.S. Dollar: The U.S. dollar index ended the week flat. While stock market weakness initially boosted demand for the dollar, the biggest drop in initial jobless claims in nearly a year provided some support.

U.S. Economic Recap

• Jobless Claims: The job market showed mixed signals. Initial jobless claims fell to 233,000, down from 250,000 the previous week, while continuing claims edged higher to 1.88 million. The four-week moving average for initial claims is rising, indicating a slowing job market.

• Consumer Credit: Consumer credit demand dropped in June, with revolving credit (including credit cards) falling by 1.5%, or $1.7 billion. In contrast, auto loans rose by $10.6 billion, the strongest gain in a year, as lower prices and more incentives drove consumers to dealerships.

Global Markets Recap

• Europe: European markets remained relatively quiet, with the STOXX 600 index up by 0.3%. The U.K. ended the week flat, while France and Germany posted slight gains. Earnings reports were a bright spot, with second-quarter earnings on track for the first growth since 2022.

• Asia: Asian markets faced sharp sell-offs on Monday due to U.S. recession fears, with Japan's market shedding 12%. However, Japan rebounded strongly on Tuesday and Wednesday, driven by positive wage growth and reassurances from the Bank of Japan. Despite gains later in the week, Japan ended lower, as did most other Asian markets.

Crypto Recap (Highlights)

• Bitcoin’s price fell below $50,000 in what traders dubbed "Crypto Black Monday." The drop was fueled by turmoil in traditional markets, including the yen carry trade unwind and concerns about U.S. economic growth. Additional pressures came from looming Mt. Gox distributions and mixed digital asset ETF flows.

• Ethereum struggled to keep pace with Bitcoin and Solana. The ETH-to-BTC conversion ratio hit a yearly low of 0.041 as Ethereum underperformed during the market downturn.

Here are other key highlights from last week:

• TON users gained free access to advanced analytics.

• Fantom rebranded to Sonic Labs, focusing on new high-speed blockchain.

• Bitcoin .com launched withe-label Web3 game from Playnance.

• Solana’s first gaming SVM surpasses 1 million monthly active users.

• Farcaster Frames support Polygon POS transactions.

This week in another important one!

What’s Happened So Far:

PPI Inflation (Tuesday 8/13/24): The July Producer Price Index (PPI) inflation fell to 2.2%, below expectations of 2.3%. Core PPI inflation also dropped to 2.4%, below the anticipated 2.7%. This marks the lowest PPI inflation level since March 2024, suggesting a September rate cut could be on the horizon.

What to Watch for the Rest of the Week:

Wednesday, August 14:

• CPI Inflation

Thursday, August 15:

• Jobless Claims

• Retail Sales

• NY Fed Manufacturing Index

• Philly Fed Manufacturing Index

Friday, August 16

• Housing Starts

• Consumer Sentiment

Fed Speakers This Week:

• FOMC Member Bostic (Tuesday 08/13/24): Discussed the possibility of a rate cut by the end of the year, highlighted a strong labour market, and downplayed recession fears.

• FOMC Members Musalem, Harker, and Goolsbee: Set to speak later this week on economic and monetary policy.

Earnings Releases:

Keep an eye on key earnings reports, which are expected to influence market sentiment this week.

Key Global Economic Events this week:

Monday, August 12:

• China New Loans

• Australia Wage Price Index

Tuesday, August 13:

• UK Claimant Count Change and Average Earnings Index

• New Zealand Interest Rate Decision

Wednesday, August 14:

• UK CPI

• Reserve Bank of New Zealand (RBNZ) Gov Orr Speaks

• China Industrial Production and Retail Sales

Thursday, August 15:

• UK GDP

• Reserve Bank of Australia (RBA) Gov Bullock Speaks

• Reserve Bank of New Zealand (RBNZ) Gov Orr Speaks

Friday, August 16:

• UK Retail Sales

Trading Tip: Mid-August is stronger in the markets than beginning and end!

Week 8/04/24 - 8/10/24 Recap

Special Tools and Strategies

In Issue 92 of the Rhoda Report, I introduced you to Google Finance as a tool for stock and crypto research. This week, let's dive deeper into how to interpret the Google Finance chart and Key Metrics table.

To begin, search for your favourite company, like Starbucks, by entering its name or ticker symbol (SBUX). The chart displayed shows you the stock’s price performance over various periods—ranging from one day to the entire history of the stock. For example, you can explore Starbucks' price changes by clicking and dragging across the chart, which will show you the percentage change and volume differences over your selected time frame.

Next, you'll notice a Key Metrics table on the right side.

This table provides important information such as:

1. Previous Close: The last price at which the stock traded in the previous session.

2. Day Range: The highest and lowest prices the stock reached during the current trading day.

3. Year Range: The highest and lowest prices over the past 52 weeks, helping you gauge the stock's volatility.

4. Market Cap: A measure of the company’s total value on the stock market, calculated by multiplying the current stock price by the total number of shares outstanding.

5. Volume: The total number of shares traded during the day, with the average volume over the past 30 days for comparison.

6. P/E Ratio: The Price-to-Earnings ratio, a key valuation metric that indicates how much investors are paying for each dollar of earnings.

7. Dividend Yield: The percentage of the stock price paid out as dividends, indicating the return on investment from dividends alone.

8. Primary Exchange: The stock exchange where the company’s shares are traded, with the NYSE and NASDAQ being the most common.

9. CDP Climate Change Score: A metric provided by CDP Worldwide, evaluating the company’s environmental impact based on responses to CDP.

If you understand these metrics and how to navigate the chart, you can better analyze stocks and make more informed investment decisions.

Disclaimer: This newsletter is strictly educational. The information this report provides does not constitute investment, financial, trading, or any other advice. You should not treat any of the report’s content as such. Please be careful and do your research.