Animal Spirits: Nasdaq Up 19% Off June Lows

MARKET UPDATE

After a 3-week S&P 500 rally, U.S. markets catching Canadian market

• Year-to-date in Canadian dollars

  • S&P 500 -11%

  • TSX             -8%

  • Nasdaq          -17%

Large-Cap Technology stocks up 19% off the June lows

10yr    2.7

• Bank of England raises rates by 0.5%, most since 1995

• U.S. job numbers/ initial unemployment claims up 6,000 to 260,000

Crude   $91     flat

• Oil prices back to pre-Ukraine/Russia war

Corn prices back to pre-Ukraine/Russia war

Meta META  +5% yesterday on Share Buyback rumours

• A no-debt company making its bond market debut

• Investment Grade debt seeking up to $10 billion @ 1.75%-1.8%

• Follows Apple debt offerings

• Proceeds to be used for general corporate purposes including Capex, share buybacks and M&A

• Will hold investor meetings

• With net cash balance sheet (no debt) and Fiscal 2022 EBITDA of $50 billion, a substantial share buyback possible

Netflix NFLX

• Wall Street Journal: Reed Hastings, founder and CEO

• Thinks Cost-per-thousand-impressions (CPM) could hit $80

• $80 would allow Netflix to charge nothing for their Ad-supported service at 2 minute/hour Ad-load

• They probably will not do that, but the Ad-supported service will be cheap, offset by Ad revenue

• Netflix shifting from grow-at-all-costs to focus on cash flows

Earnings

eBay EBAY Q2 beat top and bottom lines

Wayfair W free cash flow burn $244 million

Paramount PARA Paramount+ streaming subs missed small due to Russia

Costco COST Solid comp but decelerated, 2 year stack 20.4% to 17.8%

ConocoPhillips COP repurchased $2.3B stock, paid $1B in dividends, ended Q2 with $8.5B cash

Booking BKNG 

MetLife MET 

Fortinet FTNT

McKesson MCK 

Eli Lilly LLY

Alibaba BABA 

Toyota TM

Cigna CI 

Duke $DUKE

Zoetis ZTS 

Becton, Dickinson BDX 

CRYPTO UPDATE

1-month performance

• Bitcoin BTC/USD

• Ethereum ETH/USD

• Solana SOL/USD

• Cardano ADA/USD

• BNB BNB/USD

• Ripple XRP/USD

Coinbase is partnering with the world’s largest money manager COIN 

• BlackRock BLK teaming up with the crypto exchange to make it “easier for institutional investors to manage and trade Bitcoin”

• Wall Street extends push into crypto…

Starbucks has entered the chat SBUX 

• CEO Howard Schultz teased Web3 updates for its popular rewards program

• “Digital third place community”

• Will be unveiled on Investor Day (September 13)

Bitcoin options volume put/call ratio

• On-chain data indicates more calls are being purchased than puts