Bulls, Bitcoin, & Beyond

Market Moves Yesterday

S&P 500 @ 5,634.61 ( ⬆️ 1.15%)

Nasdaq Composite @ 17,877.79 ( ⬆️ 1.47%)

Bitcoin @ $63,661.28 ( ⬆️ 4.02%)

Hey Scoopers,

Happy Monday! Here’s what we’re covering today:

👉 Pinduoduo set to report Q2 results

👉 New home sales pick up pace

👉 Stablecoins market cap touches all-time highs

So, let’s go 🚀

Market Wrap

Equities rose on Friday after Fed chair Jerome Powell indicated interest rate cuts were on the horizon, as all three major indices posted winning weeks.

During his speech at Jackson Hole, Powell signaled rate cuts were imminent but did not provide information on when or how big the cuts to borrowing costs would be.

“The time has come for policy to adjust,” Powell said during the Fed’s annual retreat. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.

Investment bank UBS expects interest rate cuts in each of the three remaining meetings of CY 2024. UBS explained that a mixed set of labor data gives the Fed leeway to cut rates and emphasized that market fears of a recession seem overdone.

Tech stocks, including Nvidia and Tesla, rose over 4%, while the small-cap Russell 2000 advanced more than 3% as investors grew hopeful of a lower-rate environment.

Trending Stocks 🔥

Intuit - Shares of the financial software company pulled back by 6.8% after its current quarter outlook missed estimates. It forecasts adjusted earnings between $2.33 and $2.38 per share, below estimates of $2.78 per share.

Chewy - The pet retailer stock advanced more than 2% on an upgrade from Piper Sandler to outperform as the investment bank is bullish on gross margin expansion and efficiency gains.

Warby Parker - The eyeglass retailer gained 12% after JMP Securities upgraded the stock to market outperform from market perform.  

All Eyes on Pinduoduo

China’s e-commerce giant Pinduoduo is scheduled to report its Q2 earnings in the next few hours, and Wall Street expects it to grow:

👉 Revenue by 135% to $14 billion

👉 Earnings per share by 87% to $2.73 per share

Pinduoduo is the parent company of Temu, an online marketplace that offers heavily discounted consumer goods. Morgan Stanley expects Temu’s gross merchandise value to almost triple to $53 billion in 2024, up from $19 billion in 2023.

Pinduoduo has spent heavily on sales and marketing to help Temu gain traction and power in its top line. Analysts expect Pinduoduo's sales and marketing expenses to rise 62.5% to $3.9 billion in Q2 after it grew by 44% to $3.2 billion in Q1.

Pinduoduo is among the fastest-growing companies in China and has quadrupled its sales between 2020 and 2023.

However, PDD stock trades 25% below all-time highs and is valued at $194 billion, which is very cheap, given its earnings and revenue growth estimates.

For instance, Pinduoduo’s free cash flow has expanded to $13.3 billion in the last 12 months, up from $750 million in 2020, pricing the stock at 14x trailing cash flow.

New Home Sales Hit 739k

Despite inflation, elevated interest rates, and sluggish consumer spending, new home sales picked up pace in July, hitting an annualized rate of 739,000, the highest number since May 2023.

The rate of sales was higher than estimates of 620,000 and above the revised number of 668,000 in June.

The strong new home sales data meant that the iShares U.S. Home Construction ETF rose by 2.8% on Friday, ending just below its record level.

Stablecoin Market Cap Touches $169 Billion

The market cap of stablecoins has reached an all-time high of $169.5 billion amid 11 months of consecutive growth. The data excludes algorithmic stablecoins that aren’t pegged to assets such as gold or fiat.

The market reached an all-time high of $167 billion in March 2022 and fell to $135 billion by the end of that year.

Tether (USDT) is leading the pack with a market cap of $118 billion, up from $92 billion at the start of 2024. The stablecoin has registered steady monthly gains through 2024.

Meanwhile, Circle USD (USDC) is the second largest stablecoin with a market cap of $34 billion, well below its all-time high of $55.8 billion in June 2022.  

Headlines You Can't Miss!

Restaurants fight back against FTC’s crackdown over junk fees 

Tesla’s Optimus faces humanoid competition from Bejing at robot conference

Oil prices to remain elevated amid Middle East tensions

France arrests Telegram founder Pavel Durov

CZ and Binance face new lawsuit  

Chart of The Day

The U.S. is the largest economy in the world and home to 20 of the top 25 companies globally.

Except for Saudi Aramco, every company worth more than $1 trillion is based in the U.S.

With a market cap of $967 billion, Warren Buffett’s Berkshire Hathaway may be the next to join the trillion-dollar club.

Meme of the Day

Don’t follow us on social yet? Follow us on Twitter and LinkedIn now.

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.