Bulls, Bitcoin, & Beyond

Market Moves Yesterday

S&P 500 @ 5,572.85 ( ⬆️ 0.10%)

Nasdaq Composite @ 18,403.74 ( ⬆️ 0.28%)

Bitcoin @ $57,110.20 ( ⬆️ 1.77%)

Hey Scoopers,

Fasten your seatbelts. Here’s Tuesday’s breakdown:

👉 Inflation looms over retailers

👉 Big pharma and AI

👉 Crypto hackers continue to make a fortune

So, let’s go 🚀

Market Wrap 📉

Equity indices such as the S&P 500 and Nasdaq closed at fresh record highs yesterday as investors await key inflation data to provide clues to gauge if the current market rally is sustainable.

The S&P 500 index is coming off its fourth positive week amid ongoing optimism that easing inflation could lead to interest rate cuts.

The June CPI (consumer price index) will be released on Thursday and could bolster rate cut hopes if headline numbers show a slight improvement.

Further, companies such as Pepsi, Delta Air Lines, Citigroup, and JPMorgan are set to kick off the Q2 earnings season this week.

Trending Stocks 🔥

Paramount Global- The media and entertainment company shed 5.3% after it agreed to merge with Skydance Media. Moreover, Skydance will invest over $8 billion to acquire National Amusements, Paramount’s controlling shareholder.

Morphic Holding - Shares rallied 75% on news that Eli Lilly will acquire the biopharma company for $3.2 billion, providing the healthcare giant with access to Morphic’s portfolio of treatments.

Ideaya Biosciences - The stock climbed 15% after the precision medicine oncology company announced it received positive results from the phase 2 trial of its cancer treatment.

Inflation Remains a Concern for Retailers

Inflation may be cooling off, but higher prices have driven consumer demand lower. Several retailers, restaurants, and consumer companies have seen sales fall as shoppers pull back their spending.

U.S. Inflation Rate Last 12 Months

Alternatively, businesses aim to attract customers by offering shopping deals that include discounts, promotions, and value meals.

According to the U.S. Bureau of Labor Statistics, grocery prices have risen just 1% in the past year. However, food at home prices have climbed 24% in the past five years, stretching consumer wallets.

Additionally, other essential costs, such as electricity and rent, have spiked over the past two years, raising household expenses.

According to a report from the Pew Research Center, 62% of adults have said inflation is a huge problem in the U.S., a higher percentage than other issues they were asked about, such as illegal immigration, gun violence, and budget deficits.

While several consumer stocks have underperformed in recent months, big-box retail stocks such as Walmart and Costco have surged by 38% and 73%, respectively, in the last 12 months.

Big Pharma is Banking on AI

According to investment firm Jeffries, large pharma companies are partnering with AI-based drug discovery firms.

The top 25 drug discovery companies have raised over $4 billion, and pharma companies are actively accelerating collaboration across the landscape to leverage these technologies in the research and development process.

AI drug discovery stocks have struggled in 2024. However, clinical trials expected in late 2024 could act as a catalyst for companies such as Recursion Pharmaceuticals.

Hackers Steal $1.4 Billion in Crypto

A report from blockchain research firm TRM Labs showed hackers looted $1.38 billion worth of crypto in the first six months of 2024, compared to $657 million in the year-ago period.

A handful of large attacks drove the increase in plundered crypto, as the top five hacks accounted for 70% of stolen funds.

Top attack vectors in 2024 include private key and seed phrase - a sequence of random words that stores information needed to access or recover a crypto wallet- compromises.

The largest heist in 2024 saw over $300 million stolen from DMM Bitcoin, a Japan-based crypto exchange.  

Headlines You Can't Miss!

BP shares fall 3% on weak refining margins

Singapore’s Temasek to invest heavily in early AI adopters

Office vacancies touch new record in San Francisco

Corning shares pop 12% on AI boom

U.S. spot BTC ETFs attract close to $300 million

Chart of The Day

Investing in IPO or initial public offerings is a high-risk strategy. While companies that go public raise capital to fund their expansion plans, these listings are typically overvalued.

If an overvalued stock does not meet consensus revenue and earnings estimates, it significantly underperforms the broader markets.

For example, in 2021, EV maker Rivian went public with a $100 billion market cap. Rivian had yet to ship its battery-powered vehicles, and a challenging macro environment in the last two years has dragged its share prices lower by over 90%.

Meme of the Day

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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.