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Market Moves Yesterday
S&P 500 @ 5,222.68 ( ⬆️ 0.16%)
Nasdaq Composite @ 16,340.87 ( ⬇️ 0.033%)
Bitcoin @ $61,605.33 ( ⬇️ 0.82%)
Hey Scoopers,
Happy Monday! We hope you have a great week ahead.
👉 Apple inks deal with OpenAI
👉 Novovax decimates short sellers
👉 Inflation might remain elevated
So, let’s go 🚀
Market Wrap 📉
All three major indices moved higher last week, led by the Dow Jones Industrial index, which gained 2.6% in the past five trading sessions. It was also the Dow Jones index's best week since the start of 2024.
Goldman Sachs, the largest investment bank in the U.S., touched all-time highs on Friday. It rose 3.8% last week and 17% in the last month, adding 431 points to the Dow Jones index in this period. This suggests that Goldman Sachs accounted for 31% of total index gains in the past month.
Other notable movers for the DJIA index include Caterpillar, JPMorgan, American Express, and Visa.
Despite a strong start to 2024, CFRA expects the S&P 500 index to touch 5,415 by the end of 2024, up from its previous forecast of 4,940, indicating annual gains of 13.5%.
The target is 6% higher than the average S&P 500 projection of 5,105 for 2024.
Trending Stocks 🔥
TSMC - The chipmaker surged 5% after reporting a 60% jump in April sales, compared to the year-ago period, due to strong demand from the AI segment.
Gen Digital- The stock soared over 15% after the cybersecurity company reported fiscal Q4 earnings with revenue of $967 million and adjusted earnings of $0.53 per share.
Zeekr - The stock went public on Friday and traded 32% above its IPO price of $21 a share. Zeekr is a China-based EV company that outpaced Tesla in car sales in China’s Zhejiang province during the first three weeks of April.
Apple Partners with OpenAI
According to a Bloomberg report, Apple has partnered with OpenAI to use the latter’s technology on iPhones as the tech giant aims for a broader push to bring AI features to its devices.
The two companies are finalizing terms to use ChatGPT features on Apple’s next operating system. Recently, Apple also discussed licensing the Gemini chatbot for iPhones and other devices, with Google.
A collaboration with OpenAI would mean Apple would offer its user base access to a popular chatbot and a slew of other AI-powered features it plans to announce next month.
Until now, Apple was trailing companies such as Microsoft, Nvidia, and Google in the AI race.
Novovax Gains Big
Novovax stock almost doubled on Friday, rising 98.66% in a single trading session. Data from S3 partners indicate Novovax short sellers were down $196 million in mark-to-market losses and are scrambling for the exits.
Shorting a stock is a strategy where traders expect a particular stock to move lower. Here, you borrow shares and sell them in the hope of buying them back at a lower price.
Around 44.5 million shares of Novovax, or one-third of the company’s public float, are held by short sellers. Generally, a short interest holding of more than 10% is considered as high.
NVAX stock gained after it bagged a $1.2 billion licensing agreement with Sanofi. Now, short sellers are paying a 9.5% fee on existing short positions and up to 10% on new short sales executed.
Ihor Dusaniwsky, managing director at S3, stated, “We expect a rib crunching short squeeze in NVAX with short sellers taking huge losses on the market open and closing positions throughout the day.”
Inflation Has No Chill
Economists expect inflation in 2024 to run well below the Federal Reserve’s target and remain elevated for a few more years.
The U.S. Monthly Inflation Rate Comparison
The Philadelphia Fed’s quarterly Survey of Professional Forecasters puts core inflation (measured by the personal consumption expenditures price index) at 2.9% through 2024. That is well above the previous forecast of 2.1% and the Fed’s 2% target.
When measured by the consumer price index, the outlook is even less optimistic as the CPI is forecast to average 2.5% in the next five years and 2.33% in the next decade.
Headlines You Can't Miss!
Softbank posts first annual gain in three years
Arm to launch AI chips by 2025
Australia’s budget might target housing crisis
India is targeting semiconductor chip manufacturing
The U.S. government is going after Tether, says Ripple CEO
Chart of The Day
Alphabet and Meta are the two largest digital advertising platforms in the world. However, Amazon is fast gaining traction in this segment.
Amazon’s online ad sales have grown by 23% annually in the last three years, much higher than Meta and Google.
It shows that companies are spending heavily on Amazon digital ads due to high purchase intent among users.
Meme of the Day
DISCLAIMER: None of this is financial advice. The newsletter is strictly educational and is not investment advice or a solicitation to buy or sell assets or make financial decisions. Please be careful and do your own research.