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Thursday, September 5

Some of the largest macro moves in the market today include: Gold +1.0%. Bitcoin -2.4%. Ethereum -2.6%. Some of the largest moves among US mega-cap stocks include: Tesla Inc (TSLA) +2.4%. Broadcom Inc (AVGO) -1.6%. 

Recent economic data from the United States indicates a mixed labor market. Initial jobless claims fell more than expected to 227,000 for the week ending August 31st, while unit labor costs in Q2 were revised down and non-farm productivity was revised higher. However, private businesses added only 99K workers in August according to ADP—the lowest since January 2021—reflecting continued cooling of the US labor market.

In Europe, German factory orders unexpectedly rose by 2.9% month-over-month in July due to large-scale orders mainly for aircraft and electrical equipment despite declines elsewhere such as machinery and consumer goods sectors. Meanwhile, construction activity across major Eurozone economies remains subdued with significant contractions reported particularly within housing segments amid high interest rates.

Japan's wage growth exceeded expectations at an annualized rate of 3.6% year-on-year in July which supports a hawkish outlook on Bank of Japan monetary policy moving forward; this comes amidst broader concerns over global macroeconomic conditions including geopolitical tensions impacting markets globally.

Invesco QQQ Trust Series I (QQQ) [-0.4%]
Invesco QQQ Trust Series I (QQQ) has experienced a decline of 0.4% since Wednesday. Key holdings contributed negatively, with NVIDIA, Broadcom, Microsoft, Apple, and Qualcomm all posting losses. Notably, NVIDIA's CEO sold $27.6 million in stock amid concerns about market volatility, although no Department of Justice subpoena was confirmed. Microsoft received clearance for its acquisition of Inflection AI from the UK's Competition and Markets Authority, which could enhance its AI capabilities; however, slow adoption rates of its Copilot AI tools among Office users were reported. Additionally, QQQ closed below its 100-day moving average for the first time since August 12, reflecting recent volatility. On September 4, 2024, the ETF dropped slightly as major U.S. indexes closed mixed amid traders assessing new economic data and Federal Reserve comments, despite some strength observed earlier in the day following the JOLTS report.

VanEck Gold Miners ETF (GDX) [+1.7%]
The VanEck Gold Miners ETF (GDX) has experienced a price increase of 1.7% during the pre-market session on Thursday. Key contributors to this performance include notable gains from holdings such as GOLD, NEM, AEM, WPM, and PAAS. In August, global gold exchange-traded funds saw inflows of $2.1 billion, with North American funds contributing significantly, resulting in a record total of $257 billion in assets under management. Gold futures on the New York Mercantile Exchange rose by 0.8%, influenced by cooling inflation, a weakening U.S. dollar, and geopolitical tensions. The recent labor market data also played a role, with initial jobless claims falling to 227,000, marking a seven-week low. This data typically heightens volatility for GDX. Additionally, gold prices increased by 1.03%, further aligning with the movement in the ETF.

CPRT |-4.8%|-2.3B
Copart Inc | Diversified Support Services
Copart Inc. reported disappointing fourth-quarter results, with earnings per share of $0.33, falling short of the consensus estimate of $0.36. Revenue for the quarter reached $1.068 billion, below the expected $1.081 billion, but reflecting a year-over-year increase from $997.591 million. The company's gross profit was reported at $454 million, while net income decreased to $323 million from $347.79 million in the same quarter last year. Following these announcements, Copart shares experienced a decline of approximately 5.56% in after-hours trading. Additionally, the CEO noted a 6% year-over-year growth in business with insurance sellers, attributing this to an increase in total loss frequency linked to a decline in used vehicle values returning to pre-pandemic norms.

HPE |-3.4%|-802.4M
Hewlett Packard | Technology Hardware, Storage & Peripherals
Hewlett Packard Enterprise Co (HPE) reported a net revenue of $7.71 billion for Q3, marking an increase from $7.00 billion year-over-year. Net income rose to $512 million, up from $464 million in the prior year, and earnings per share (EPS) reached $0.50, exceeding the consensus estimate of $0.47. Despite these positive results, HPE's stock experienced a decline of approximately 4.6% in after-hours trading, influenced by decreased revenue from its Intelligent Edge and Hybrid Cloud segments. The company's guidance for Q4 suggests an EPS between $0.52 and $0.57, with revenue anticipated between $8.1 billion and $8.4 billion, both slightly below analyst expectations. Notably, HPE achieved record-high revenue in its AI server segment, reflecting strong demand in that area.

FTV |+4.3% | +1.1B
Fortive Corp | Industrial Machinery & Supplies & Components
Fortive Corp has announced a tax-free spin-off of its Precision Technologies segment, resulting in two independent, publicly traded companies. This strategic decision is designed to enhance growth by allowing Fortive to concentrate on its Intelligent Operating Solutions and Advanced Healthcare Solutions. The company plans to allocate approximately 75% of its available free cash flow for share repurchases before the spin-off, expected in the fourth quarter of 2025. Fortive has reaffirmed its earnings per share guidance for fiscal year 2024 at $3.8 to $3.86 and revenue guidance between $6.2 billion and $6.3 billion. The positive market response, reflected in a price increase, coincides with heightened social media discussions surrounding the spin-off and its implications for operational efficiency and shareholder value.

AZN |-2.3% | -3.0B
AstraZeneca PLC | Pharmaceuticals
AstraZeneca PLC is currently under significant scrutiny in China, where authorities have detained five employees from its oncology division. These individuals, all Chinese nationals, are being investigated for alleged violations related to data privacy and the importation of an unlicensed liver cancer drug not approved for distribution in mainland China. The company has acknowledged the investigation but has not provided further details. This development coincides with broader market weaknesses affecting AstraZeneca and its peers, contributing to a recent decline in its stock price.

TSLA | +2.3% | +16.2B
Tesla Inc | Automobile Manufacturers
Tesla Inc plans to launch its Full Self-Driving (FSD) driver assistance technology in Europe and China by the first quarter of 2025, contingent upon regulatory approval. This announcement was made via a post on X and indicates a focus on enhancing FSD technology in the U.S. prior to international expansion. Concurrently, the company is expected to introduce parking assistance features for its Cybertruck soon. Despite delays in the rollout of advanced driver-assistance features in China, the timeline aligns with previous earnings call discussions. In premarket trading, Tesla shares rose by 2.5%, reflecting these developments. Notably, former President Donald Trump is set to establish a government efficiency commission inspired by CEO Elon Musk's recommendations, which may influence Tesla's operational landscape.

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