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Market Moves Yesterday
S&P 500 @ 5,983.99 ( ⬇️ 0.29%)
Nasdaq Composite @ 19,281.40 ( ⬇️ 0.090%)
Bitcoin @ $87,404.37 ( ⬇️ 1.02%)
Hey Scoopers,
Happy Wednesday! Are you ready to tackle the midweek mania?
👉 Spotify surges ahead
👉 Shopify crushes earnings estimates
👉 Dogecoin gains pace
So, let’s go 🚀
Market Wrap
All three major stock market indices retreated on Tuesday, taking a breather from their post-election run.
Key components of the so-called Trump trade were among the most notable losers. Small-cap stocks, viewed as a potential beneficiary of Donald Trump’s return to the White House, were broadly under pressure, with the Russell 2000 dipping about 1.8%.
Shares of Tesla, which have advanced about 31% since Election Day, sank more than 6% on Tuesday, while Trump Media & Technology Group fell nearly 9%.
Next, investors will examine October’s CPI numbers, scheduled for release this morning, to see how much the costs of goods and services have risen. Economists expect the CPI to increase 0.2% for the month, putting the 12-month rate at 2.6%.
The pace of price increases is also one of the key components in informing the Federal Reserve’s decision to cut or maintain interest rates.
Other notable economic data releases later this week include the producer price index data and retail sales numbers, which will be announced on Thursday and Friday, respectively.
Trending Stocks 🔥
Skyworks Solutions - The semiconductor company slipped over 3% after reporting adjusted earnings of $1.55 per share in fiscal Q4, above estimates of $1.52 per share. However, its guidance for the current quarter was lighter than estimates.
Cava - The fast-casual chain popped 16% after reporting revenue of $244 million and earnings of $0.15 per share vs. estimates of $234 million and $0.11 per share, respectively.
GE Vernova - Shares tumbled almost 8% after the wind turbine manufacturer announced that it was holding off searching for new offshore turbine orders.
Spotify Gains Almost 7%
Spotify shares are up 7% in pre-market trading after the music-streaming company issued a Q4 net income forecast that exceeded estimates.
In Q3 of 2024, Spotify reported:
👉 Revenue of 3.99 billion euros vs. estimates of 4.02 billion euros
👉 Earnings per share of 1.45 euros vs. estimates of 1.72 euros
👉 Monthly active users of 640 million vs. estimates of 639 million
While Spotify’s Q3 revenue and earnings trailed estimates, investors were upbeat about its guidance for Q4.
Spotify expects to end Q4 with an operating income of 481 million euros, above estimates of 432.7 million euros.
It has forecast MAUs to increase to 665 million, ahead of estimates of 659 million. Notably, Spotify forecasts Q4 sales at 4.1 billion euros, below estimates of 4.26 billion.
Subscribers to Spotify Premium, the company’s ad-free membership service, increased 12% year over year to 252 million, slightly ahead of estimates. Its MAUs rose 11% year over year in Q3, while it expects to end 2024 with 260 million premium subscribers.
Spoifty's sales increased by 19% year over year in Q3, while operating income rose to 454 million euros, up from 32 million euros last year.
The results come after Spotify raised the price for individual Premium subscriptions to $11.99 per month from $10.99 in July. The Duo plan increased to $16.99 from $14.99, while the Family plan jumped to $19.99 from $16.99.
Shopify Continues to Rally
Shopify shares surged over 20% yesterday after the Canadian e-commerce company announced its Q3 results, reporting:
👉 Revenue of $2.16 billion vs. estimates of $2.12 billion
👉 Earnings per share of $0.35 vs. estimates of $0.27
Shopify expects revenue in Q4 to grow at a percentage in the mid-to-high-twenties, compared to Wall Street’s expectations of 22.8% for revenue growth.
In Q3, its gross merchandise volume, or the total volume of merchandise sold on the platform, rose 24% to $69.7 billion, above estimates of $68.1 billion.
Shopify sells software and services for online business merchants, which include advertising and payment processing tools.
Shopify emphasized that a growing number of major retailers and companies signed up for its services during the quarter, pointing to Lionsgate Entertainment, shoemaker Reebok, luxury fashion brand Off-White, and handbag companies Vera Bradley and Hanes.
In recent quarters, Shopify has focused on improving profit margins amid slowing revenue growth. In the past 12 months, its free cash flow has risen to $1.5 billion, up from $905 million in 2023.
Dogefather Joins the White House
Dogecoin shot higher yesterday night, extending its post-election surge after President-elect Donald Trump announced the creation of the Department of Government Efficiency, which he called “DOGE’.
Tesla CEO Elon Musk and Vivek Ramaswamy, the co-founder of Strive Asset Management, will lead the department.
According to Trump, Musk and Ramaswamy “will pave the way for my administration to dismantle government bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies.”
Dogecoin was last up 20% and has gained 153% since election day, compared to Bitcoin’s 30% rise. The rally enabled Dogecoin to surpass XRP this week to become the sixth-largest cryptocurrency by market cap.
Memecoins are seen as a gauge of crypto's retail interest and risk appetite. When memecoin activity ramps up, it indicates that retail investors are participating and intend to speculate further on the risk curve.
Trump initially floated the idea of an efficiency commission in September. Since then, Musk — who has called himself the “Dogefather” in the past and has been known to make public comments about the memecoin that influence its price — has posted on his social media platform X, referring to the commission as the “Department of Government Efficiency” or “D.O.G.E.”
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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.