"Push it Real Good!"

Hi There! As the 2024 Olympics officially commence in the vibrant city of Paris, France, my heart swell with pride for the small but mighty contingent representing Grenada. Though few in number, their spirit and determination have already earned them a victory in the hearts of every Grenadian.

In track and field:

• Kirani James (400 metres)

• Anderson Peters (Javelin)

• Lindon Victor, (Decathlon)

• Halle Hazzard (100 metres)

In the pool:

• Tilly Collymore (100 metres Freestyle)

• Zackary Gresham (100 metres Backstroke)

To our athletes, your hard work and dedication inspire me. No matter the outcome, you have already achieved greatness and made your country immensely proud. Let’s go, Team Grenada!

Alright, let’s dig in!

Last Week Recap

Last week, the stock market roared back to life after a tough stretch. Investors were buoyed by strong economic data, including a robust GDP report of 2.8% for Q2 and the Federal Reserve’s favourite inflation gauge showing cooler numbers. Big Tech made a comeback, and 3M saw its biggest one-day gain on record with a 6.7% jump after surpassing quarterly expectations and resolving legal issues.

Despite midweek headwinds from disappointing big tech earnings, U.S. equities managed to stabilize, thanks to better-than-expected economic data. The Dow Jones led the way among major U.S. indexes, European markets closed mostly higher, and Asian markets ended lower. Treasuries rose as yields fell on hopes for rate cuts, while the dollar remained steady amid a yen surge.

U.S. Markets

• Equities: It was a volatile week for U.S. equities. Earnings season was in full swing, with big tech taking a hit from disappointing results, leading to a tech sell-off that pulled the S&P 500 down by 0.6% and Nasdaq by 2.0%. The Dow Jones performed better, driven by value stocks and small caps, which outperformed growth stocks and gained 0.9%. The market rebounded towards the end of the week, supported by strong GDP data and lower-than-expected inflation figures.

Fixed Income:

• Treasury yields fell, with the 10-year yield dropping nearly five basis points to 3.95% and the two-year yield down six basis points to 4.75%. This decline was driven by mixed economic data, including weaker housing data and strong GDP numbers. The yield curve steepened, signaling potential rate cuts ahead, which could benefit fixed-income investors but also indicate an economic slowdown.

Commodities:

• Gold ended slightly lower by 0.5%, while silver and copper also declined.

• The Bloomberg precious metals and industrial metals indexes reflected this downturn.

• Soft commodities struggled throughout July.

Currencies:

• The U.S. dollar index held steady at 101.5, despite midweek fluctuations.

• The Japanese yen surged by 1.8%, driven by traders unwinding short positions and Bank of Japan intervention.

U.S. Economic Recap

• Inflation: June saw a slight rise in inflation by 0.07%, with goods prices declining by 0.17% and services prices rising by 0.20%. Inflation is moderating, nearing the Fed's target of 2%, and is expected to influence rate-cut decisions.

• Q2 Growth: The economy grew by 2.8% in Q2, driven by inventory rebuilding and government spending. Consumer spending on services like healthcare, housing, and utilities supported growth, though a potential softening is expected in Q3.

• Housing: Existing home sales fell by 5.4% in June, driven by high prices and low supply. Affordability remains a challenge, and improvements are unlikely until mortgage rates drop.

Global Markets Recap

• Europe: European markets focused on earnings, with the STOXX 600 index ending the week 0.6% higher. Weak sales from LVMH and disappointing earnings from other companies impacted the market. Political developments included French President Macron calling for a political truce during the 2024 Summer Olympics.

• Asia: Asian markets faced volatility, particularly in tech stocks. China’s unexpected rate cuts and lack of consumer stimulus led to declines. India reached record highs despite budget updates, while Taiwan dealt with typhoon disruptions. Australia ended lower by 0.3%, and New Zealand had mixed results.

Crypto Recap

The crypto market was buzzing with major political figures advocating for Bitcoin and Ethereum ETFs gaining traction. Bitcoin edged towards $70k, and Ethereum's ETF-driven rally looked promising.

• Highlights:

  • Former President Donald Trump made a historic speech at the Bitcoin conference in Nashville, advocating for a strategic Bitcoin stockpile and promising regulatory changes.

  • 2024 Presidential Candidate Robert F. Kennedy Jr. proposed matching U.S. gold reserves with Bitcoin, aiming for massive adoption.

  • Senator Cynthia Lummis announced a bill for the U.S. Treasury to buy 1 million Bitcoin over five years.

  • Ethereum ETFs launched successfully, with strong inflows totaling $106.8 million on the first day, driving a positive market impact.

  • Solana (SOL) surpassed Binance Coin (BNB) to become the 4th largest crypto by market cap, currently valued at $55 billion.

Here are other key highlights from last week:

• JP Morgan pitched in-house chatbot as AI-based research analyst.

• Tesla’s Bitcoin holdings remained unchanged in Q2.

• Michigan Pension Fund disclosed $6.6M Investment in Bitcoin ETFs.

• Ondo launched the first tokenized treasury product on Cosmos.

• NPC Labs raised $21 million to streamline Web3 gaming infrastructure.

• Doodles launched token-gated media platform Doodlesᵗᵛ .

This is another key week in the markets!

So Far:

Tuesday, July 30:

• CB Consumer Confidence: July Consumer Confidence rose to 100.3, beating expectations of 99.7 and up from 97.8. This indicates that consumers are feeling more optimistic and spending more.  

• JOLTS Jobs Openings: June job openings fell to 8.184 million, slightly above the estimate of 8.020 million and down from 8.230 million. There were 1.2 job openings per unemployed worker, the lowest since March 2021, indicating reduced labour demand.

What to Watch for the Rest of the Week:

Wednesday, July 31:

• Fed Interest Rate Decision (expected to hold rates steady)

• FOMC Conference - Fed Chair Powell Speaks

Thursday, August 1:

• Initial Jobless Claims (expected at 236k)

• ISM Manufacturing PMI (expected at 48.8)

Friday, August 2:

• Non-Farm Payroll (expected at 176k)

• Unemployment Rate (expected to hold at 4.1%)

Earnings Releases:

Notable earnings releases this week are outlined in the chart below.

Key Global Economic Events this week:

Tuesday, July 30:

• Germany CPI

• Australia CPI and Retail Sales

• China Non-Manufacturing and Manufacturing PMI

• Bank of Japan (BoJ) Interest Rate Decision

Wednesday, July 31:

• Canada GDP

• Euro Area CPI

Thursday, August 1:

• Bank of England (BoE) Interest Rate Decision

Friday, August 2:

• Switzerland CPI

Trading Tip: When the market shifts direction, follow the new trend!

Week 7/21/24 - 7/27/24 Recap

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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.