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Tuesday, August 13

Some of the largest macro moves in the market today include: Ethereum -3.0%. Nasdaq 100 Index (US) +0.9%. USD/CNH -0.2%. Some of the largest moves among US mega-cap stocks include: NVIDIA Corp (NVDA) +3.5%. 

Recent economic data releases have significantly impacted market sentiment. In the United States, core producer prices remained unchanged in July 2024 from the previous month, falling short of expectations and indicating a slowdown in inflationary pressures at the wholesale level. This follows less-than-expected factory gate price increases for July as well.

In Europe, mixed signals emerged with UK unemployment rates unexpectedly dropping to 4.2% while German investor confidence plummeted according to the ZEW survey—the largest decline seen in two years—highlighting ongoing concerns about Germany's economic outlook despite marginal improvements elsewhere within Eurozone indicators.

Geopolitical tensions continue to influence markets globally; reports suggest potential Iranian attacks on Israel could impact risk appetite and drive volatility across various asset classes including oil and gold prices which saw significant movements recently due to these developments alongside broader macroeconomic factors such as central bank policies being closely monitored by investors ahead of key US CPI data expected tomorrow.

Ethereum (ETH/USD) [-3.2%]
Ethereum is currently experiencing a decline, down approximately 3.0%. This drop is influenced by rising geopolitical tensions, particularly related to conflicts involving Iran and Israel, which have prompted a shift towards safe-haven assets like gold. The market is also anticipating upcoming U.S. Producer Price Index data, which may affect inflation expectations and Federal Reserve interest rate decisions, critical factors for cryptocurrency sentiment. Despite some positive inflows into Ether ETFs and a rise in decentralized exchange tokens, BlockTower Capital's sale of $25 million worth of Ethereum has raised concerns about further price declines amid whale movements and reduced institutional buying interest. Bitcoin has also seen a decline, reflecting broader market sentiment that may contribute to Ethereum's current price movement.

EWJ [+1.5%]
The iShares MSCI Japan ETF (EWJ) has increased by 1.4% during the pre-market session, coinciding with a notable surge in the Japanese Nikkei 225 index, which rose significantly. This uptick was driven by gains across various sectors amid growing optimism ahead of upcoming U.S. inflation data releases. The movement in USD/JPY contributed negatively to the ETF's performance, impacting it by 0.28%. Additionally, geopolitical tensions involving Iran and potential threats to Israel have heightened demand for safe-haven assets, which may influence market stability and risk appetite related to Japan's economic outlook. In the broader market context, the S&P 500 Index has also moved upward, reflecting a general positive sentiment that may be affecting EWJ.

OXY |-2.1%|-1.1B
Occidental Petroleum Corp has announced a secondary public offering of 29.56 million shares, priced at $58.30, with a deal range of $58.30 to $58.50, managed by JPMorgan, Morgan Stanley, and RBC Capital. Additionally, Occidental affiliates have initiated a secondary public offering of 19 million common units in Western Midstream Partners, targeting gross proceeds of approximately $685.9 million, expected to close on August 14, 2024, pending customary conditions. Following these announcements, shares of Western Midstream fell significantly in after-hours trading. Concurrently, Occidental filed for an underwritten secondary offering of 20 million shares for CrownRock, with no shares being offered by Occidental itself. The market reacted to these offerings, affecting the public float and share price dynamics.

SBUX | +13.8% | +13.7B
Starbucks has appointed Brian Niccol as its new Chairman and Chief Executive Officer, effective September 9, 2024. Niccol, currently CEO and Chairman of Chipotle, is recognized for significantly increasing revenue and profits during his tenure there. He will succeed Laxman Narasimhan, who has stepped down immediately. In the interim, Rachel Ruggeri will serve as CEO until Niccol's arrival. Following this announcement, Starbucks shares have experienced a notable increase in value. Additionally, Starbucks Corp is outperforming its sector peers, suggesting strong relative performance within the industry.

TME |-9.0%|-3.7B
Tencent Music Entertainment Group reported a fiscal second-quarter revenue decline of 1.7% year-over-year to 7.16 billion yuan (985 million), falling short of analyst expectations. This drop was primarily due to a significant 42.8% decrease in revenue from social entertainment services, which amounted to 239 million yuan. Conversely, revenues from online music services rose by 27.7% year-over-year to 746 million. The company reported adjusted EPS of 0.16 yuan, matching consensus estimates. Monthly active users for online music decreased by 3.9% to 571 million, while social entertainment users fell by 31.6% to 93 million. Following the earnings announcement, shares of Tencent Music fell by 5.6% in premarket trading.

HD |-0.8% | -2.8B
Home Depot has revised its fiscal 2024 outlook, now forecasting a decline in adjusted earnings per share (EPS) between 1% and 3%. The company expects total sales growth of 2.5% to 3.5%, an increase from prior estimates. However, comparable sales are projected to decrease by 3% to 4%, a notable shift from earlier guidance. In the second quarter, customer transactions fell by nearly 2% year-over-year, with comparable sales down over 3%, including a significant drop in U.S. stores. Despite a slight revenue increase to $43.18 billion, this figure fell short of expectations. In the recent earnings report, EPS came in higher than anticipated at $4.67, while revenues were lower than expected at $43.2 billion. Additionally, EPS guidance for fiscal 2024 was lowered, while revenue guidance was raised.

LOW |-1.2% | -1.6B
Lowe's Companies Inc is experiencing a decline, moving in tandem with the broader market and its sector, which is also significantly lower. The stock's recent performance is notably influenced by Home Depot's disappointing results, including a revenue miss for the second quarter and a fiscal year 2024 adjusted EPS outlook that fell below estimates. This has led to a drop in Home Depot's shares, which has historically correlated with Lowe's stock movements. Additionally, social media discussions highlight a notable decline in Home Depot's stock following its earnings report, further impacting Lowe's shares. Overall, Lowe's is outperforming its sector peers despite the negative sentiment stemming from competitor news.

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