What Moved The Markets This Week 📈

Aug 20, 2023

Sunday Morning Markets

Trading Week 33, covering Monday, Aug 14 through Friday, August 18. Your weekly financial markets update, in less than 5 minutes.

Retail sales jump 0.7% in July coming in higher than expected as the consumer continues to spend. Sales were boosted by a 1.9% jump in spending at online retailers, while food service and drinking places rose 1.4%.
US Leading Economic Index (LEI) falls again, marking the 16th straight month of decline. The LEI tumbled 0.4% in July after declining 0.7% in June. The index is down 8% versus the year prior, traditionally seen as a recession indicator.
US housing starts surged 3.9% in July while permits for future construction rose amid an acute shortage of previously owned homes. The strong report was viewed as another sign of the economy continuing to defy recession forecasts.
Mortgage rates jump to highest level since 2002 as the average 30-year fixed rate mortgage hits 7.09% according to Freddie Mac. High rates are making it harder for buyers to afford homes, which are already in short supply.
Intel scraps $5.4B acquisition of Tower Semiconductor after regulators fail to approve deal. Tower is a contract chipmaker that manufactures semiconductors for other companies. Intel will pay Tower a $353M termination fee.
Intuit’s Alex Chriss named as new PayPal CEO and will take over in late September. Chriss previously ran the small business and self-employed group at Intuit and spearheaded the $12B acquisition of Mailchimp.

Tesla makes further price cuts in China as it looks to boost sales amid rising competition in one of its key markets. The price of the Model X was cut 6.9% to ¥837K, while the Model S was cut 6.7% to ¥808K.
China’s Evergrande filed for bankruptcy in the US as the company referenced restructuring proceedings in Hong Kong, the Cayman Islands, and the British Virgin Islands. Evergrande is the world’s most indebted property developer.
China surprises markets with rate cuts as the PBOC cut its medium-term lending facility by 15 basis points, and cut its short-term lending rates by 10 basis points. The supportive move comes as the economy continues to sputter.
Japan’s GDP shockingly grows 6% in Q2 coming in well above analysts’ expectations of 3.1%. “We expect a renewed slowdown across the second half of the year,” Marcel Thieliant, head of Asia-Pacific at Capital Economics.
UBS to pay $1.4B in fraud settlement over “legacy” misconduct related to the sale of residential mortgage-backed securities. UBS allegedly knew the mortgages in the MBS were problematic or noncompliant, but sold them anyway.
Vietnamese EV maker VinFast goes public at an $85B valuation, vaulting its market cap past Ford, GM, BMW, and Volkswagen. VinFast shares then plunged during the week and the company finished the week worth ~$35B.

SpaceX turned a profit in the first quarter due to surging revenue, The WSJ reported. The rare look at SpaceX’s financials offers a clue into how the company is faring while it ramps up its Starlink satellite internet service.
Cruise and Waymo see a surge in app downloads following a vote last week by the California Public Utilities Commission that allowed the two companies to expand and charge for their driverless car operations in San Francisco.
Amazon Pharmacy lowers insulin prices to $35 through an automatic coupon on products from pharmaceutical manufacturers, including Novo Nordisk and Eli Lilly. Customers also get free delivery and 24/7 access to Amazon’s pharmacists.
Genesis and FTX settle for $175M in bankruptcy claim following a nearly $4B claim made on behalf of FTX’s failed sister company, Alameda Research. FTX CEO John J. Ray III described the settlement as “fair and equitable”.
Coinbase wins approval to offer crypto futures trading in the United States, scoring a major regulatory win even as the crypto exchange battles a lawsuit from the SEC. The global crypto derivatives volume totaled ~$1.85T in July.

See other breakdowns on our Twitter page.

US - New Home Sales (JUL)🇺🇸
US - S&P Flash Services PMI (AUG)🇺🇸
US - S&P Flash Manufacturing PMI (AUG)🇺🇸
Canada - Retail Sales (JUN)🇨🇦
Europe - S&P Flash Composite PMI (AUG)🇪🇺
Earnings Reports: Nvidia, Snowflake, Analog Devices, NetEase, Autodesk, NetApp, Splunk, Grab Holdings, Peloton💰

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