Bulls, Bitcoin, & Beyond

Market Moves Yesterday

S&P 500 @ 5,597.12 ( ⬇️ 0.20%)

Nasdaq Composite @ 17,816.94 ( ⬇️ 0.33%)

Bitcoin @ $59,668.40 ( ⬇️ 0.59%)

Hey Scoopers,

Happy Wednesday! Are you ready to tackle the mid-week mania?

👉 Walmart offloads JD.com

👉 Berkshire reduces exposure to BoA

👉 Gold prices touch fresh all-time highs

So, let’s go 🚀

Market Wrap 📉

Equities ticked lower on Tuesday, ending a winning streak as investors failed to build on the recent recovery rally.

The decline snapped an eight-day winning streak for the S&P 500 and Nasdaq, the highest streak since late 2022. Meanwhile, the Dow Jones notched its first negative day in the last six sessions.

Boeing was the largest underperformer in the Dow Jones Industrial Average on Tuesday. The aircraft manufacturer tanked 4.2% after discovering a failure in the key engine mounting structures of its 777X test fleet.

Intel was the second-worst-performing Dow stock, losing roughly 2.5% in market cap. Meanwhile, JPMorgan just missed its longest winning streak on record. The bank stock gained for ten consecutive trading days before Tuesday.

Trending Stocks 🔥

Eli Lilly - The healthcare giant added 3% after a late-stage trial found that its weight loss drug reduced the risk of obese adults developing Type 2 diabetes by 94%.

Microchip Technology - Shares of the microcontroller fell 2% after a regulatory filing disclosed “potentially suspicious activity” within its IT systems, which affected some operations.

Keysight Technologies - The test equipment manufacturing stock popped over 11% in pre-market after reporting solid fiscal Q4 guidance on revenue, with the top end of its range surpassing consensus estimates.

JD.Com Stock Is Down 9%

Shares of China’s e-commerce giant JD.com are down over 9% in Hong Kong at the time of writing after U.S. retailer Walmart confirmed it will sell its stake in the company.

Walmart explained that its decision to offload its stake would allow the big-box retailer to focus on its strong China operations and deploy capital towards other priorities.

Walmart entered into a strategic alliance with JD.com in June 2016, taking a 5% stake in China’s e-commerce leader. In fact, Walmart ended 2023 with a 9.4% stake in JD.com.

Shares of JD.com have been rangebound in the last five years, trailing the broader markets in this period.

Valued at $44 billion by market cap, JD.com is quite cheap and trades at 9x forward earnings. It is also priced at a 50% discount to consensus price target estimates.

Berkshire Is Offloading Bank of America Stock

Warren Buffett’s Berkshire Hathaway offloaded Bank of America shares again, continuing its selling spree in the banking giant.

According to an SEC filing, Berkshire sold 13.9 million shares for $550.7 million in the past three trading days. The ongoing sale pushed Berkshire’s stake in BoA to 11.9%.

Buffett famously purchased $5 billion of BoA’s preferred stock and warrants in 2011 after the financial crisis. The stake shored up investor confidence as the lender was wrestling with losses tied to subprime mortgages.

Berkshire Hathaway ended Q2 with $277 billion in cash. Given the recent stake sale in companies such as BoA and Apple, does the Oracle of Omaha expect the equity markets to fall in the next 12 months?

Gold Prices Gain Pace

Gold prices touched a fresh record high on Tuesday, fueled by a weaker U.S. dollar and the possibility of an interest rate cut.  

Gold Prices Comparison Chart (Last 10 Years)

Spot gold prices rose 0.8% to $2,524.88 per ounce. Moreover, holdings of the SPDR Gold Trust, the largest gold-backed exchange-traded fund (ETF), also jumped to their highest in seven months at 859 tons.

Gold prices are up 22% in 2024, heading for its best year since 2020. The precious metal is used as a store of value and a hedge against inflation.

Investing in gold ETFs is a good strategy as it diversifies your portfolio and lowers overall risk. Historically, gold has shown an inverse relationship to bonds and has thrived amid periods of economic and geopolitical turmoil.

Headlines You Can't Miss!

EV maker Nio focuses on building charging infrastructure 

Amazon-backed Anthropic hit with copyright infringement lawsuit 

What can you expect from Target’s upcoming earnings?

Weak demand impacts the global steel industry

Binance faces new lawsuit for laundering of stolen crypto

Chart of The Day

Today, the Magnificent Seven are among the largest companies in the world, valued at a combined market cap of $15.4 trillion. The Mag 7 companies include stocks such as Microsoft, Nvidia, Apple, Meta Platforms, Amazon, Alphabet, and Tesla.

Since 2012, the market caps of these tech giants have grown by 13.5x, with Nvidia leading the way, returning 360x. Meanwhile, Apple has seen “just” a 7x growth in its market cap.

In the first half of 2024, the Mag 7 drove 49% of the S&P 500 index, which indicates their growth story is far from over.

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.