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Friday, July 19

Some of the largest macro moves in the market today include: Gold -1.8%. Silver -2.8%. Some of the largest moves among US mega-cap stocks include: Eli Lilly and Co (LLY) +2.6%. Amazon.com Inc (AMZN) -1.5%. Microsoft Corp (MSFT) -1.3%. 

A significant global IT outage caused by a flawed update from cybersecurity firm CrowdStrike has impacted various sectors, including airlines and financial services. This disruption led to notable declines in tech stocks such as Microsoft (-1.3%) and Amazon.com Inc (-1.5%), contributing to broader market volatility.

Economic data releases indicate that Canadian retail sales are projected to have dropped 0.3% month-over-month in June, extending the previous month's decline of 0.8%. Additionally, Canada's Raw Materials Price Index fell more than expected at -1.4%, driven primarily by decreases in crude energy products and metal ores due to OPEC+ production adjustments and rising stockpiles in China.

In Europe, German producer prices shrank year-on-year but rose slightly on a monthly basis (+0.2%). Meanwhile, UK public sector borrowing decreased significantly compared to last year amid reduced debt interest payments despite higher spending on public services; however, consumer confidence hit its highest level since September 2021 amidst ongoing political uncertainties.

VGT [-0.5%]
Vanguard Information Technology ETF (VGT) experienced a -0.7% price movement pre-market, coinciding with significant drops in top holdings like MSFT and CRWD due to global IT outages impacting Microsoft cloud services and Windows hosts' content update issues, respectively. NVIDIA Corp's stock saw a slight increase after strategic acquisitions and engagements aimed at reducing reliance on its technology. The S&P 500 Index also decreased, aligning with VGT's historical correlation, reflecting broader market movements.

Gold (XAU/USD) [-1.7%]
Gold (XAU/USD) decreased by 1.4% since Thursday's close, now below $2,430, influenced by profit-taking after hitting a record high above $2,480. The drop coincides with expectations of a Federal Reserve interest rate cut in September and political uncertainty surrounding President Joe Biden's re-election bid. Social media discussions also involve the UUP and XAU alongside GLD. Silver (XAG/USD) exhibited a strong correlation, decreasing by 2.50%, reflecting a parallel shift in the precious metals market.

CRWD |-12.6%|-9.2B
CrowdStrike Holdings Inc experienced a significant price drop of 12.5% due to a global IT outage caused by a defect in a Windows update, impacting systems worldwide. CEO George Kurtz clarified it was not a security breach, but the fix may take over two weeks for full restoration, affecting various industries globally. The incident also led to disruptions in businesses such as airlines, banks, and media services. CrowdStrike shares fell alongside Microsoft's due to Azure-related issues amid the outage, with efforts underway to roll back the faulty update, emphasizing that Mac and Linux hosts were unaffected. The outage prompted operational challenges for organizations like American Airlines and the London Stock Exchange, highlighting the widespread impact on different sectors.

MSFT | -1.3% | -41.2B
Microsoft Corp saw a -1.3% price change pre-market due to a global IT outage affecting its cloud services, caused by CrowdStrike's faulty update leading to connectivity failures in Microsoft 365 and Azure services. The disruption impacted various sectors worldwide, with both companies experiencing stock fluctuations as CrowdStrike decreased by around 20%. Despite the chaos, Microsoft has been actively restoring services, with improvements noted. The issue, clarified as an internal glitch by CrowdStrike CEO George Kurtz, resulted in global disruptions, including airlines, banks, media outlets, and emergency services. Efforts to stabilize systems have been ongoing post-outage, with both companies reassuring investors amidst recovery operations.

AXP |-2.1%|-3.6B
American Express Co's stock price dropped 3.2% due to the company's strong Q2 performance, with net income increasing significantly to $3.0 billion and total revenues up 8% to $16.3 billion. The adjusted EPS of $3.49 surpassed estimates, leading to a raised full-year EPS guidance of $13.30 - $13.80. Despite an initial 2% premarket rise, the stock reversed to -1.7% post-results, reflecting market volatility. The company's solid earnings report, exceeding expectations and showcasing improved financial outlook, coincided with the price movement, emphasizing the impact of fundamental company-specific data on market sentiment.

LLY |+2.7% | +22.3B
Eli Lilly and Co's stock price rose by +2.6% pre-market, driven by the approval of its weight loss drug Tirzepatide for long-term weight management in China by the National Medical Products Administration. This approval intensifies competition with Novo Nordisk in the weight loss market, projected to reach $100 billion globally by the end of the decade. Both companies' drugs belong to the GLP-1 agonists class, originally developed for diabetes, showing significant weight loss benefits for patients. The move positions Eli Lilly to compete effectively in the burgeoning obesity treatment market, where Novo Nordisk has also secured approval for its weight loss drug, Wegovy, in China.

AMZN |-1.4%|-26.0B
Amazon.com Inc's stock dropped -1.3% in premarket trading, hitting a low of -1.8%, underperforming its competitors amidst gains by tech giants. Despite a successful Prime Day, the stock fell 2.3%, coinciding with broader market losses post-Dow and Nasdaq highs. Amazon is set to release Q2 earnings after August 1st, hinting at potential volatility ahead of this crucial financial update.

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