What Moved The Markets This Week 📈
Unemployment Rate Spikes to 3.8%, Job Openings Plunge, Shopify's New Major Partnership With Amazon, Bitcoin ETF Approval Soon, and CRM + CRWD + MDB Earnings
Sunday Morning Markets
Trading Week 35, covering Monday, Aug 28 through Friday, Sept 1. Your weekly financial markets update, in less than 5 minutes.
The Week In Review ⏪
Labor market data:
Nonfarm payrolls +187K (est. 170K)
ADP employment +177K (est. 200K)
Unemployment rate 3.8% (est. 3.5%)
Job openings 8.83M (est. 9.5M)
PCE inflation eases to 3.3%, meeting estimates
Visa & Mastercard plan to hike their interchange fees
Canada’s economy unexpectedly contracts in Q2
Microsoft to unbundle Teams product in Europe
Shopify’s major new partnership with Amazon
Google to start charging $30 per month per user for AI tools
Spot Bitcoin ETF could be approved soon, court rules against SEC
Earnings from Salesforce, Crowdstrike, MongoDB— see breakdowns below
US Markets 🇺🇸
Fed’s key inflation gauge ticks higher in July while jobless claims unexpectedly declined. The PCE index rose 3.3% for the year, meeting estimates. The figure was an acceleration from the increase of 3.0% in the month prior.
Nonfarm payrolls jump by 187,000 in August, ahead of the estimate for 170,000. However, unemployment unexpectedly rose to 3.8% as participation improved. The counts for June and July were revised considerably lower.
Job openings fall 338,000 to 8.83 million as the labor market loses steam. The number of available positions peaked at over 12 million back in May 2022. However, there are still 1.51 job openings per unemployed person.
FTC allows Amgen to acquire Horizon Therapeutics in a massive $27.8B deal. The agreement specifically prohibits Amgen from “bundling” two of Horizon’s blockbuster drugs; thyroid eye disease therapy Tepezza and Krystexxa.
Regional banks get hit with new restrictions in a move meant to protect the public in the event of more failures. The requirements will create “moderately higher funding costs” for banks with at least $100B in assets.
Visa and Mastercard plan to hike credit card fees, especially for payments made online. The hikes are scheduled to start in October. According to their latest 10-Ks, Visa has 62% operating margins whereas Mastercard has 58%.
Goldman Sachs sells its personal financial management unit to Creative Planning as the company continues to offload businesses that were recently acquired under CEO David Solomon.
Millions of Charter’s customers lose access to Disney networks, including ESPN, amid a battle over contract fees. The blackout comes during the U.S. Open and a week ahead of the kickoff of the NFL season.
Rest of World 🌏
Canada’s economy contracts 0.2% in the second quarter, surprising markets as the print came in significantly lower than the Bank of Canada's forecast of 1.5 percent growth and analysts' consensus of around 1.2 percent growth.
Eurozone inflation remains steady in August as headline inflation in the 20 country-bloc sharing the euro was unchanged at 5.3% but above expectations of 5.1%. Core inflation in the region eased to 5.3% from July’s 5.5%.
German inflation eases slightly in August but economists warn the downward trend may reverse in the coming months. Core inflation, which excludes the volatile food and energy, was 5.5% in August, unchanged from July.
Microsoft to unbundle Teams from Office in Europe and make it easier for competing products to work with its software. Rivals like Salesforce believe it may need to do more to stave off the looming EU antitrust fine.
China’s factory activity shrinks for a fifth straight month in August as the official manufacturing PMI came in at 49.7. China’s official non-manufacturing PMI fell to 51.0 in August, down from 51.5 in July.
Xpeng announces major deal with Didi to purchase their smart electric car development business unit in an exchange of shares worth $744 million. Xpeng shares have rallied 84% so far this year.
Tech ⚡
Shopify announces major partnership with Amazon that will allow merchants to offer a ‘Buy with Prime’ option. Shoppers can purchase items using their Amazon wallet, while merchants can utilize Amazon’s fulfillment network.
Google to charge $30 per month for AI features in its Gmail and other various work apps. It’s the same price Microsoft charges for its AI enhancement tools as both companies rush to add the technology to their core products.
Google to sell maps data through a new API and sees a range of potential customers as Zillow, Marriott, and Tesla. Google has data on over 350 million buildings globally and expects the API to generate up to $100M in the first year.
OpenAI on track to generate more than $1B in revenue over the next 12 months from the sale of artificial intelligence software. Earlier this year, the ChatGPT owner projected $200M in revenue for 2023.
Apple testing 3D printing technology to manufacture the chassis in the upcoming Apple Watch Series 9. Bloomberg reported that Apple will roll out 3D printing for other products’ manufacturing if the initial tests go well.
Tech unicorn, Babylon Health, goes bankrupt as its operation turned insolvent earlier this month. The London-based telehealth startup was once valued at $2B and was backed by the founders of DeepMind and major insurance companies.
Robinhood to buy back SBF’s stake for $606M from the U.S. Government. The shares of Robinhood were originally seized and transferred to the custody of the U.S. Gov after Bankman-Fried's FTX filed for bankruptcy last year.
The first spot Bitcoin ETF could be coming soon as the D.C. Circuit Court ruled in favor of Grayscale over the SEC. The decision could impact other companies that want to create Bitcoin ETFs, such as BlackRock and Fidelity.
Earnings Reports 💰
See other breakdowns on our Twitter page.
Weekly Poll 🗳️
Week Ahead 📅
Monday
US - Markets Closed, Labor Day 🇺🇸
China - Caixin Services PMI (AUG)🇨🇳
Earnings Reports: Trip💰
Tuesday
US - Factory Orders (JUL)🇺🇸
Europe - S&P Composite PMI (AUG)🇪🇺
Australia - RBA Interest Rate Decision🇦🇺
Earnings Reports: Zscaler, Gitlab, Asana💰
Wednesday
US - S&P Services PMI (AUG)🇺🇸
US - ISM Non-Manufacturing PMI (AUG)🇺🇸
Canada - BoC Interest Rate Decision🇨🇦
Earnings Reports: C3.ai, UiPath, Couchbase, Yext💰
Thursday
US - Jobless Claims 🇺🇸
US - Nonfarm Productivity (Q2)🇺🇸
Canada - Ivey PMI (AUG)🇨🇦
Germany - Industrial Production (JUL)🇩🇪
Earnings Reports: Smartsheet, DocuSign, RH💰
Friday
Germany - CPI Inflation (AUG)🇩🇪
China - CPI Inflation (AUG)🇨🇳
China - PPI Inflation (AUG)🇨🇳
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