“Release 'Em!”

Hi There! Letting go is tough, and parting with my trusted Orange Bug after 16 years and over 254,000 miles has me feeling a mix of emotions. It’s hard to say goodbye to the car that carried me through so many chapters of life. The familiar hum of the engine, the countless road trips, the comfort of that perfectly adjusted seat, and all those everyday moments—from piano lessons and recitals to powerlifting trainings and competitions and field visits across Missouri and neighbouring States—are memories I’ll always cherish.

This was more than just a car; it was there when my daughter learnt to drive and kept us company with its good old CD player. It was our companion on journeys near and far, fitting into tight spots and always getting us where we needed to go.

Yet, there’s a bittersweet edge to letting go. It means welcoming something new, stepping into the unknown, and adapting to modern technology. But I’m choosing to see it as a chance for fresh experiences and new adventures.

I’m truly grateful for all the years with my Orange Bug and excited for the possibilities that lie ahead.

Here’s to moving forward, one mile at a time.

Alright, let’s dig in!

Last Week (September 29 - October 05, 2024) Recap

Stocks continued to show resilience, with major indexes posting modest gains despite economic uncertainties and geopolitical tensions. Investor sentiment was boosted by a stronger-than-expected U.S. jobs report, which helped offset concerns around interest rate policies and rising tensions between Israel and Iran. Treasury yields jumped in response, the Bloomberg Commodities Index advanced, propelled by oil. Energy stocks saw notable gains, fueled by surging oil prices amid the ongoing conflict.

U.S. Markets

Major indexes managed to defy September's weak historical trends, closing the month and quarter higher last week. The Dow gained 0.90% for the week, the S&P 500 rose by 0.22%, and the Nasdaq increased 0.08%. Rate cut expectations for November shifted as hopes for a 0.5% reduction faded following Fed Chair Powell’s remarks. Labour market data supported this shift, with the unemployment rate coming in lower than expected at 4.1%, and nonfarm payrolls increasing sharply.

Energy stocks led the market last week, fueled by escalating Middle East tensions after Iran's missile attack on Israel. Oil prices surged as investors worried about potential disruptions to supply, driving oil stocks higher. The geopolitical risk weighed on broader market sentiment.

• Fixed Income: Treasury yields climbed sharply following Friday’s labour report, with the two-year yield jumping 34 basis points to 3.91% and the 10-year yield rising 22 basis points to 3.97%. Bond market volatility remained elevated as markets adjust to shifting rate expectations.

• Commodities: WTI crude oil surged nearly 10% as geopolitical tensions fueled concerns about supply disruptions. Gold saw intra-week volatility, finishing slightly lower despite nearing record highs, while silver helped lift the Bloomberg Precious Metals Index.

Currencies:

• U.S. Dollar: The U.S. dollar strengthened following the Fed’s stance on not rushing future rate cuts and last Friday’s robust jobs data.

U.S. Economic Recap (September 29 - October 05, 2024)

• Jobs Report: Nonfarm payrolls rose by 254,000 in September, above expectations. The unemployment rate fell to 4.1%, with wage growth continuing.

• ISM Services Data: Mixed results, with prices accelerating and new orders reaching their highest since February 2023.

• Job Openings and Residential Spending: Job openings increased in August, while residential construction spending contracted.

Global Markets Recap

• Europe: Stocks dipped amid geopolitical concerns, despite a late boost from U.S. labour data. Hopes for rate cuts in Europe grew as inflation fell below 2%, though market reactions were subdued.

• Asia: Asian markets had a mixed week. Mainland China rallied 8% before its holiday break, while other regional markets, including Japan, South Korea, and Taiwan, faced pressure from Middle East tensions.

Crypto Recap (September 29 - October 05, 2024)

• Japan Welcomes Blockchain: Japan’s incoming Prime Minister, Shigeru Ishiba, announced plans to integrate blockchain and NFTs to boost local economies, positioning Japan as a leader in Web3 adoption.

• Tokenized Collateral Gains Momentum: The CFTC moved closer to allowing tokenized funds like BlackRock’s BUIDL and Franklin Templeton’s FOBXX to be used as collateral, potentially increasing blockchain’s role in traditional finance.

• CZ’s Release Boosts BNB: Binance founder Changpeng "CZ" Zhao was released from prison, triggering a 7% rise in Binance Coin (BNB). Despite legal challenges, CZ’s return has renewed optimism in the crypto community.

Here are other key highlights from last week:

• Advanced Micro Devices (AMD) stock gained 10% in September.

• Sui launched native bridge to Ethereum.

• Lamborghini announced its Genesis Capsule NFT launch.

• Ethereum game “Gods Unchained” revealed “Tower of Dread” expansion.

• Polygon becomes a hub for prediction markets.

Another Key Week in the Markets!

Key U.S. Economic Developments This Week:

• Wednesday: FOMC Minutes

• Thursday: CPI Inflation and Initial Jobless Claims

• Friday: PPI Inflation and Consumer Sentiment

Other Events to Watch:

• Oil Price Volatility: Middle East tensions could lead to supply concerns.

• Tech Updates: NVIDIA and AMD are hosting AI events this week.

Fed Speakers:

Several Fed officials have already spoken this week, providing insights into the central bank's outlook:

• FOMC Member Kashkari (Monday): He expressed confidence in the labour market's strength and indicated that the neutral Fed funds rate might be around 3%. Kashkari also emphasized that inflation is moving towards the 2% target, supported by a decline in new rent prices.

• Fed Vice Chair Jefferson (Tuesday): He noted that employment and inflation goals are balanced and expects inflation to keep trending toward 2%.

• FOMC Member Collins (Tuesday): Collins highlighted the moderation in core inflation but warned that it remains elevated. She also stressed the importance of maintaining a healthy labour market.

• FOMC Member Kugler (Tuesday): She indicated that future rate cuts would be based on inflation data and that if economic risks increase, a faster pace of cuts may be warranted.

Remaining Fed Speeches This Week:

• Wed

  • Remarks from FOMC Members Bostic, Goolsbee, and Williams.

• Thursday

  • FOMC Members Bowman, Cook, and Barkin will share their views.

• Friday

  • FOMC Members Goolsbee and Bowman will conclude the week’s Fed commentary.

Earnings Season Kickoff:

Third-quarter (Q3) earnings begin, with major banks like JPMorgan, Wells Fargo, and BlackRock reporting on Friday.

Global Economic Events This Week:

• Reserve Bank of Australia (RBA) Interest Rate Decision (Monday)

• Reserve Bank of New Zealand (RBNZ) Interest Rate Decision (Tuesday)

• China’s New Loans Data (Thursday)

• UK GDP and Canada’s Unemployment Rate (Friday)

Trading Tip:

Focus on consistency, aim for steady profits, and stay calm during occasional losses.

Week 9/29/24 - 10/05/24 Recap

Special Tools and Strategies - Investing vs Trading!

I’m often asked about the difference between investing and trading. Although some people use these terms interchangeably, they represent different approaches. Both aim to grow wealth in markets like stocks, crypto, or NFTs, but they involve unique strategies, risks, and potential rewards. Knowing these differences can help you decide which fits your financial goals, risk tolerance, overall wealth strategy, and, more importantly, your personality.

What is Investing?

Investing involves buying assets such as stocks, ETFs, bonds, or crypto with the expectation that their value will grow over time. It’s a long-term approach aimed at reaching goals like retirement or homeownership. Typically, this strategy is more hands-off—often called a "set it and forget it" approach—where you benefit from growth and compounding without needing to monitor the market daily. It’s ideal for those who prefer a focus on long-term financial goals.

What is Trading?

Trading, by contrast, focuses on capitalizing on short-term price fluctuations in assets like stocks, options, futures, or crypto. Traders frequently buy and sell within days, weeks, or even minutes to capture quick gains. This hands-on strategy demands constant monitoring and quick decision-making, making it unsuitable for those who prefer a more laid-back approach. Trading can be highly emotional due to the fast-moving nature of markets.

Key Differences:

This comparison shows how the approaches differ in terms of strategy, effort, and risk tolerance.

Choosing Between Investing and Trading:

• Investing suits those looking for steady growth who can tolerate long-term market ups and downs.

• Trading is better for those who enjoy active portfolio management and taking advantage of rapid market shifts.

Some choose to combine both approaches for diversification, balancing long-term growth with short-term opportunities.

Similarities:

Both involve risk and reward, offering chances for compounding returns and dividend income, which can boost gains.

Tips for Beginners:

• Align your strategy with your risk tolerance and availability.

• If time is limited, consider investing in diversified funds.

• If you enjoy tracking market trends, explore trading cautiously, starting small to manage risks.

All in all, while investing and trading share some similarities, such as account setup and asset transactions, they are fundamentally different approaches. Investing focuses on long-term growth with a cautious mindset, whereas trading involves short-term strategies and a deeper understanding of market movements. Whether you choose to invest or trade, it's important to recognize both the potential rewards and risks, ensuring your approach aligns with your financial goals and risk tolerance.

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.