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Market Moves Yesterday
S&P 500 @ 5,221.42 ( ⬇️ 0.024%)
Nasdaq Composite @ 16,388.24 ( ⬇️ 0.29%)
Bitcoin @ $62,359.35 ( ⬆️ 0.37%)
Hey Scoopers,
Happy Tuesday! We have an exciting newsletter for you today.
👉 The GameStop short squeeze is on
👉 OpenAI launches new AI model
👉 AI boom to impact the supply of memory chips
So, let’s go 🚀
Market Wrap 📉
The Dow Jones index slid 0.2% yesterday, posting its first losing session in nine and snapping its longest streak since December. The S&P 500 inched lower, while the tech-heavy Nasdaq gained roughly 0.3%.
A New York Federal Reserve report indicated consumer expectations for inflation have grown over the short and long term, weighing heavily on the three major indices.
Another market catalyst that will emerge this morning is April’s producer price index. Economists expect the PPI to gain 0.3% from the previous month.
The consumer price index (CPI) for April will be out tomorrow, and economists expect it to rise 0.4% for the month or 3.4% year over year.
Trending Stocks 🔥
Oklo - Shares of Sam Altman’s nuclear energy company surged over 15%. The stock made its debut last week and fell over 50% in its first trading session.
Alibaba- China’s e-commerce giant surged 5% and is forecast to report Q1 earnings today. Analysts expect the company to report revenue of $30.4 billion with adjusted earnings of $1.41 per share, compared to $29.15 billion and $1.50 per share last year.
Novovax - The healthcare stock surged over 47% after it inked a $1.2 billion licensing agreement with Sanofi.
GameStop Gains 74.4%
Monday’s monster rally meant GameStop’s short sellers have already lost $1.24 billion in May, according to data from S3 Capital.
Shares of GameStop and AMC rallied dramatically on Monday after “Roaring Kitty” posted online for the first time since 2021. Keith Gill, the man behind the Roaring Kitty account, inspired the epic short squeeze of 2021, leading to the eventual fall of Melvin Capital, a hedge fund.
Roaring Kitty posted the above image on X to indicate he’s taking “the game” seriously, garnering over 22 million impressions in the last two days.
The meme stock mania gripped Wall Street in 2021, when retail investors in a Reddit forum took aim at short sellers and hedge funds that were bearish on GameStop and other companies, such as AMC.
Short sellers were then forced to cover their positions, resulting in a short squeeze and an astonishing rally in GME stock, which went from $3 to $150 in less than four months.
Right now, GameStop stock is priced at $30.45 and has more than tripled in the last month after rising 74% yesterday. Around 175 million GME shares changed hands, 30 times its one-year average. The volatility associated with the meme stock led to multiple halts in trading activity.
The current short position in GameStop shares is around 24%. A ratio over 10% is considered as high. A short squeeze seems inevitable.
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OpenAI’s New Model is Here
OpenAI, the company backed by Microsoft, just launched a new AI model and desktop version of ChatGPT. The new model, GPT-4o, is much faster with improved text, video, and audio capabilities. OpenAI said it eventually plans to allow users to video chat with ChatGPT.
Source: Axios
Found in 2015, OpenAI is a revolutionary company valued at more than $80 billion. It is now under pressure to maintain its leadership position in the generative AI market while finding ways to generate revenue as it continues to spend huge sums on processors and chips to train its AI models.
Microsoft has a sizeable stake in OpenAI and is at the helm of an AI gold rush as companies across industries are adding AI-powered chatbots to key services.
Around $29.1 billion was invested across 700 generative AI deals last year, an increase of 260% year over year. The AI market is forecast to surpass $1 trillion in revenue within 10 years.
AI Boom to Result in Chip Shortage
Due to explosive AI demand, analysts expect high-performance memory chips to remain in tight supply this year.
Memory chip suppliers such as SK Hynix and Micron are out of high-bandwidth memory chips for 2024 and the stock for 2025 is also sold out.
Demand for AI chipsets has boosted the high-end memory chip market, acting as a tailwind for memory chipmakers globally.
Headlines You Can't Miss!
UBS is bullish on European stocks
China drives EV boom in 2024
Is the 4% retirement withdrawal rule still relevant?
Walmart to begin corporate layoffs
Crypto funds see inflows of $130 million last week
Chart of The Day
Tech giant Apple has been the best-performing stock in the last two decades. A $1,000 investment in Apple stock back in early 2004 would be worth over $527,000 today.
The other top performers include Nvidia, Monster Beverages, Booking Holdings, Netflix, and Amazon.
The chart shows the benefits of staying invested in quality stocks and the power of compounding.
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.aring