“The world is jam packed full of wonder – just waiting to be discovered. I am forever in awe!”
“The world is jam packed full of wonder – just waiting to be discovered. I am forever in awe!”
World’s largest luxury group LVMH slumps after Q2 revenue miss
Shares in LVMH fell on Wednesday after the luxury group on Tuesday 23rd July 2024 released its earnings for the first half of 2024
Shares in the world’s largest luxury group LVMH pulled-back on Wednesday 24th July 2024 after its second-quarter sales came in below analysts expectations
Other luxury sector stocks, including Gucci-owner Kering which is set to report earnings on Wednesday 24th July, also retreated.
LVMH one year share price chart from July 2023
Tesla shares fall after weaker-than-expected results
Tesla’s shares dropped in U.S. pre-market trading following the electric car maker’s Q2 earnings report, which fell short of expectations.
The company saw a 7% year-on-year decrease in automotive revenue for the June 2024 quarter, down to $19.9 billion, and a decline in its ‘adjusted’ earnings margin.
Investors are divided on Tesla’s stock, with some concerned that the core car business is struggling, while others remain optimistic about Musk’s vision for autonomous driving.
Tesla continues to lead in U.S. electric vehicle sales, yet it’s facing declining market share as competitors emerge, partly due to its older range on offer and Elon Musk’s occasional controversial public statements.
Attention has shifted to other aspects of Tesla’s narrative, such as the anticipated introduction of a new mass-market vehicle to refresh its vehicle lineup. Musk reportedly re-affirmed that Tesla plans to launch an ‘affordable’ car in the upcoming year.
Tesla 3-year share price chart as at: 23rd July 2024
The earnings also highlighted his robotaxi vision. Musk shared his ‘expectation’ of a future where Tesla owners could allow their vehicles to operate in an Uber-like ride-hailing environment, with the cars driving autonomously.
And then we have the prospect for the greatly hyped arrival of Tesla’s humanoid robot due in 2025.
As we all know – Musk does much more than EVs.
Ether ETFs launched in the U.S. on 23rd July 2024 with BlackRock, Grayscale and others
Bitcoin is often likened to a type of digital gold, but Ether is seen more as a native cryptocurrency on the Ethereum blockchain.
It is generally seen as a trade or bet on the growth and of the development of the blockchain and of crypto more widely.
Many of the funds set to launch this week have temporarily waived fees in an attempt to attract buyers.
The Securities and Exchange Commission (SEC) has historically been wary of cryptocurrencies. However, the regulator was defeated in a legal battle last year concerning Bitcoin ETFs, which aided their launch in January 2024.
Given that both Bitcoin and Ether have regulated futures markets, the introduction of ether ETFs was viewed as the industry’s subsequent rational progression.
Bitcoin ETFs have attracted about $17 billion in net inflows since their launch in January 2024.
What is An Ethereum ETF?
An Ethereum ETF, or Ether ETF, is an exchange-traded fund that tracks the price of ether (ETH), the cryptocurrency with the second-highest market capitalization following Bitcoin. Unlike purchasing Ethereum on a cryptocurrency exchange, an Ethereum ETF is bought and sold on traditional stock exchanges.
How an Ethereum ETF works
An Ethereum ETF contains futures contracts linked to Ethereum’s price movements. These contracts enable investors to speculate on Ethereum’s future price without the need to own the cryptocurrency directly.
Investing in an Ethereum ETF offers exposure to Ethereum’s price volatility while eliminating the need to handle wallets or navigate the intricacies of cryptocurrency exchanges. Such ETFs offer traditional investors a practical avenue to engage with the cryptocurrency market, leveraging the conventional environment of stock exchanges.
Ethereum one year price chart as at: 16:10 BST 23rd July 2024 from CoinMarketCAP
Elon Musk suggests Tesla will use humanoid robots in 2025
Tesla boss Elon Musk says the electric car maker will start producing and using humanoid robots from next year.
In a social media update, Elon Musk stated that Tesla will initially employ the robots, with plans to commence production for sale by 2026.
He had earlier anticipated that the robot, named Optimus, would be operational in Tesla factories by this year’s end. Additionally, companies such as Honda Rototics and Boston Dynamics are also advancing their humanoid robot technologies.
“Tesla will have genuinely useful humanoid robots in low production for Tesla internal use next year and, hopefully, high production for other companies in 2026,” Mr Musk posted on his social media platform X.
Wiz dumps $23 billion deal with Google -reportedly to pursue IPO
Wiz has apparently walked away from a deal with Google that would have valued the company at $23 billion.
The deal would have nearly doubled the $12 billion valuation of the startup from its most recent round of funding.
CEO of WIZ Assaf Rappaport told employees the company would pursue an IPO as originally planned.
Wiz was founded in 2020 and has grown rapidly. The company had been targeting an IPO as recently as May 2024. The business hit $100 million in annual recurring revenue after 18 months and reached $350 million last year.
Wiz’s cloud security products offer prevention, active detection and response, a portfolio that’s appealed to large firms and would have helped Google compete with Microsoft, which also sells security software.
One to watch for a potential future IPO.
UK national debt as a percentage of GDP is now 99.5%
Highest ratio since the 1960’s and even higher than that reached during the Covid pandemic of 2020.
The UK’s national debt has reached its highest level since 1962.
Official figures from the ONS show that the total government debt amounted to 99.5% of the economy’s value in June 2024, surpassing the peak levels experienced during the coronavirus pandemic.
The current debt level is comparable to that last observed in the early 1960’s.
CrowdStrike shares tumble as fallout from global tech failure continues
CrowdStrike’s shares fell a further 13% on Monday 22nd July 2024 while the cybersecurity software firm attempted to help clients from various sectors to recover from an outage that disrupted millions of Microsoft Windows devices on Friday 19th July 2024.
CrowdStrike 5-day share price chart
Early Friday, the company released a flawed update to its Falcon vulnerability-protection software, leading to crashes in PC’s, data centre servers, and networked display screens.
This caused flights to be grounded and medical appointments to be cancelled among numerous other ‘knock-on’ problems world-wide. Microsoft reported that the incident affected 8.5 million Windows devices, which is less than 1% of the global total.
IT staff swiftly acted to repair computers. At the same time, hackers attempted to exploit the turmoil by creating malicious websites that seemed to provide software updates.
See CrowdStrike website for more details about this issue.
Chief security officer Shawn Henry said the incident had been a “gut punch” for the firm, which had previously been one of the most trusted names in the industry.
“We let down the very people we committed to protect, and to say we’re devastated is a huge understatement,“ he reportedly said.
Mr Henry, a former FBI executive assistant director, reportedly said the weekend had been “the most challenging 48 hours” of his 12 years at the company. He promised it would use the incident as an opportunity to “emerge better and stronger than ever”.
“The confidence we built in drips over the years was lost in buckets within hours, and it was a gut punch,” he said in a LinkedIn post, on Monday 22nd July 2024.
“But this pales in comparison to the pain we’ve caused our customers and our partners.”
Fact or fiction: Russia traded warships for Soda
The fascinating tale of Pepsi’s unexpected naval acquisition dates back to the late 1950’s.
In 1959, during the Cold War, the United States and the Soviet Union were engaged in an ideological battle – communism vs capitalism.
In that time, the U.S.S.R. held an exhibition in New York to demonstrate its cultural and technological progress. In response, the United States established the American National Exhibition in Moscow, which featured various American products, including the famous carbonated beverage, Pepsi-Cola
The kitchen exhibition
In July 1959, then-Vice President Nixon and Soviet Premier Khrushchev engaged in a lively debate at the American National Exhibition. Set against the backdrop of a model American kitchen, they argued over the merits of capitalism versus communism. The exhibition also showcased a Pepsi-Cola booth, symbolizing the beverage’s American and Russian variants.
Pepsi for Khrushchev
Donald M. Kendall, an executive at Pepsi, embarked on a mission to have Khrushchev hold a Pepsi. On the exhibition’s eve, Kendall made a bold promise to Nixon. He aimed to showcase the trip’s significance, culminating in the staged moment where Khrushchev tentatively sipped Pepsi. This pivotal event was captured in a photograph, acquainting numerous Russians with the fizzy beverage for the first time.
The deal
The Soviet Union had a long-established tradition of exchanging vodka for Pepsi concentrate. However, the arrangement took an extraordinary turn when Pepsi served as an intermediary in a remarkable swap: the Soviets offered a fleet of 17 submarines, a cruiser, a frigate, and a destroyer – estimated to be worth around $3 billion – as compensation for their pending Pepsi delivery. This deal briefly made Pepsi the possessor of the world’s sixth-largest naval force.
Pepsi’s fleet
The company eventually sold the warships for scrap, but for a brief period, they boasted an impressive naval fleet.
This event marks a unique chapter in the history of both the beverage industry and naval affairs, where the worlds of carbonated drinks and military warships intersected.
One of the world’s biggest IT incidents caused by a cyber-security company’s update
CrowdStrike issue causes major outage affecting thousands of businesses around the world
The irony
It has been widely reported that an ‘update‘ by ‘cybersecurity‘ firm CrowdStrike led to a major IT outage on Friday 19th July 2024, impacting businesses around the world. Microsoft systems have been badly affected.
CrowdStrike statement
“The issue has been identified, isolated and a fix has been deployed,” CEO George Kurtz said in a statement on X. But not before untold havoc was caused across the globe.
Blue screen of death
The comments came after widespread reports of technical issues, with many Microsoft users around the world facing an error screen known as the ‘blue screen of death.’
Biggest IT fail ever – Elon Musk
Elon Musk on X called it the ‘Biggest IT fail ever’.
Problems
Reports flooded in all day from around the world of systems and businesses impacted by the issue.
Without going into individual failings, here are some of the areas impacted by this problem.
NHS and GP practices in the UK, airport delays, flight cancellations, SKY TV off air, Microsoft system failures, VISA issues, Sainsbury’s and Morrissons supermarket card payments down, banks hit, Lloyds, Tesco, airlines in U.S., Germany, Canada, Italy, India and around the globe. UK Rail payment systems down and trains cancelled, New York Metro train issues, schools, betting firms hit, finance, pharmacies, payrolls and even the Paris Olympic system too.
Interconnected frailty
I think you get the picture. This is by no means an exhaustive list – but it aptly demonstrates the severity of this failed system update and how interconnected our world has become.
Crowdstrike says global IT issues caused by ‘defect’ in ‘content update’
Here’s the full statement from George Kurtz, the CEO of Crowdstrike
“Crowdstrike is actively working with customers impacted by a defect found in a single content update for Windows hosts.
“Mac and Linux hosts are not impacted. This is not a security incident or cyberattack.
“The issue has been identified, isolated and a fix has been deployed.
“We refer customers to the support portal for the latest updates and will continue to provide complete and continuous updates on our website.
“We further recommend organisations ensure they’re communicating with Crowdstrike representatives through official channels.
“Our team is fully mobilised to ensure the security and stability of Crowdstrike customers.”
Who and what is Crowdstrike?
CrowdStrike is a cybersecurity firm established in 2011, dedicated to protecting major corporations and their hardware from cyber threats and vulnerabilities.
The company specializes in endpoint security, striving to block malicious software and files from compromising corporate networks via connecting devices like phones and laptops.
Additionally, CrowdStrike focuses on securing the data of businesses that have transitioned from hosting it on-premises to utilizing cloud-based services.
Should we worry?
As our world becomes over interconnected and closely Intergrated, should we be concerned about a handful of powerful companies dictating the tech world we live in?
I believe we should be concerned. This was just a routine upgrade and the company let us down.
I used to run my own IT business and upgrades and system improvements were a big part of my then tech life, so I have a pretty good understanding of these issues, especially performing a system upgrade.
Preparation is key. Sometimes things go wrong – the unforeseen. But you must quickly overcome the problem with a ‘backup’ contingency plan.
Others are depending on YOU!
My mantra then and it is still the same now: BACKUP! BACKUP! BACKUP!
You have to get these this right – but CrowdStrike didn’t!
It will happen again!
Worst day for Nasdaq since 2022 as investors continue to rotate out of tech. S&P 500 slides – Dow gains
On Wednesday 17th July 2024, the Nasdaq Composite and S&P 500 pulled-back as investors continued to shift from tech stocks to more interest rate-sensitive sectors.
The S&P 500 dropped 1.39%, closing at 5588. The tech-geared Nasdaq tumbled 2.77%, finishing at 17996, marking its worst session since December 2022 and ending below 18000 for the first time since 1st July 2024.
Conversely, the Dow Jones Industrial Average resisted the downward trend, gaining around 243 points, or to close at 41198. This advance led the index to close above the 41000 milestone.
Nasdaq Composite 17th July 2024 – one day chart
S&P 500 17th July 2024 – one day chart
Dow Jones 17th July 2024 – one day chart
Pound hits highest level versus dollar for a year
The pound reached its highest level against the dollar in a year on Wednesday 17th July 2024, as investors wagered that UK interest rates would remain elevated for longer.
New data released on Wednesday 17th July 2024 indicated that inflation was more persistent than some analysts had anticipated, leading traders to reduce their expectations of a rate decrease in August 2024, propelling the pound above $1.30 for the first time since the previous July.
Additionally, the pound’s strength has been supported by market optimism that the newly elected Labour government will provide economic stability.
UK inflation holds at Bank of England’s 2% target but above projections
U.K. inflation matched the Bank of England’s target of 2% in June 2024, as calculated by data from the Official for National Statistics on Wednesday 17th July 2024.
The main figure was slightly higher than the 1.9% forecast by analysts surveyed by Reuters, aligning with May’s 2% figure.
Following the announcement, the value of Sterling increased modestly, reaching $1.2977 at 7:21 a.m. British Summer Time.
The Bank of England (BoE) closely monitors services inflation due to its significant role in the U.K. economy and as an indicator of domestic price increases, which remained at 5.7% in June. Service inflation remains a stubborn issue and a problem still for the BoE.
The core inflation rate, which excludes energy, food, alcohol, and tobacco, stood at 3.5%, consistent with the rate seen in May 2024.
Market rotation helps Dow to a 743-point one day gain to close at a record high. Russell 2000 and crypto benefit
The Dow Jones Industrial Average closed at a record high Tuesday 16th July 2024, rallying 743 points for its biggest one-day increase in more than a year, as the bull run appeared to broaden.
The small cap-focused Russell 2000 also rose for the fifth straight day, rising 3.5% fast closing in on a new record high as the money continues to rotate from tech stocks.
Russell 2000 index one year chart
The Dow Jones finished at 40,954, marking an increase of 1.85% for the day. It has experienced consistent daily gains since the previous week, culminating in an overall rise of over 4% over the past five trading days. The closing value on Tuesday 16th July 2024 represents the largest single-day gain since June 2023.
Dow one year chart as at: 16th July 2024
The market saw an uptick amidst a broader rally, driven by the news that June retail sales exceeded expectations, strong earnings reports to date, and the expectation of a benchmark interest rate reduction by the Federal Reserve in September.
Positive remarks from the Federal Reserve about potential interest rate cuts are bolstering market sentiment. Additionally, the buzz surrounding Trump’s re-election campaign and the recent assassination attempt on Trump at one of his election rallies seem to be influencing market movements as well.
However, Donald Trump reportedly said Taiwan should pay the U.S. for defence, in an interview with Bloomberg Businessweek published on Tuesday 16th July 2024. His comment had a negative impact on chip and tech stocks.
Crypto is enjoying the market rotation as more money is being ploughed back into cryptocurrencies. Bitcoin jumped from a low point in July 2024 of just below $56,000. Altcoins are also enjoying a mini-recovery.
Bitcoin benefitting from markets rotation – one year chart
Gold gains again to hit new record high!
Gold prices climbed to $2,482 per ounce, hitting an all-time high.
Gold prices continued to peak at new record highs Tuesday and Wednesday 15th and 16th July 2024.
On Monday 15th July 2024, Powell reportedly said the Fed won’t wait for inflation to reach the central bank’s 2% target before it begins cutting, due to the ‘lag’ in policy effects. He reportedly said the Fed is looking for ‘greater confidence’ that inflation will return to the 2% level. The monthly inflation rate dipped in June 2024 – the first time in over four years.
The price increase has been aided by encouraging comments from the Federal Reserve that it will now more likely cut interest rates in September 2024 following comments from Fed Chair Jerome Powell.
And that has given market investors and traders more confidence. According to the CME FedWatch tool, traders are convinced the FOMC will cut rates by September 2024.
As interest rates fall, gold usually becomes more appealing compared to fixed-income assets such as bonds and general savings accounts.
One year gold chart to 17th July 2024 (am)
What the Fed said
Jerome Powell appears to be further paving the way for a rate cut at the next meeting in July 2024.
Federal Reserve Chair Jerome Powell reportedly said Monday 15th July 2024 that the central bank will not wait until inflation hits 2% to cut interest rates.
Powell referenced the idea that central bank policy works with ‘long and variable lags’ to explain why the Fed wouldn’t wait for its target to be hit.
‘The implication of that is that if you wait until inflation gets all the way down to 2%, you’ve probably waited too long, because the tightening that you’re doing, or the level of tightness that you have, is still having effects which will probably drive inflation below 2%,’ Powell reportedly said.
Instead, the Fed is looking for ‘greater confidence’ that inflation will return to the 2% level, Powell remarked.
‘What increases that confidence in that is more good inflation data, and lately here we have been getting some of that,’ he reportedly said.
Powell also said he thinks a ‘hard landing’ for the U.S. economy was not ‘a likely scenario.’
It looks like it is time for that rate cut, he didn’t say that!
Burberry share price slides as company announces profit warning
Burberry shares slide on Monday 15th July 2024 after the UK luxury fashion group announced a profit warning and a dividend halt and said its chief executive officer (CEO) was being replaced.
The maker of the iconic trench coat described a ‘disappointing’ fiscal first-quarter 2025 in a trading update.
Burberry reportedly said that if the recent trading slowdown continues, it expects to report an operating loss for the first half of this year and full-year operating profit below current consensus.
Shares in the 168-year-old British luxury giant were down 15% on Monday 15th July 2024 in early London trading.
Burberry share price falls to around 745 on Monday 15th July 2024 – one year share price chart
Dow rises more than 400 points to hit intra-day of 42000 then trims back before close
Let the rotation begin
The Dow Jones Industrial Average surged on Friday 12th July 2024 as investors began to diversify beyond the technology sector.
The Dow closed at 40,000.90, after hitting a new all-time high of 40,257.
The S&P 500 added 0.55% to 5,615, and the Nasdaq Composite went up 0.63% to 18,398. However, on Thursday 11th July 2024 the S&P 500 experienced its worst day since late April due to a major market rotation, with Nvidia dropping 5.6%.
Investors rotated from tech to industrial stocks in the Dow on Friday, hoping that slowing inflation might lead to a Federal Reserve rate cut in September.
The Dow gained 1.6% for the week, spurred by a report showing a 0.1% decline in the consumer price index for June. Recent reports suggest that the Federal Reserve might indeed consider a rate cut in September if inflation continues to slow.
While the AI growth has been dominant, other market catalysts, such as potential rate cuts, can also drive different sectors, including utilities.
Good earnings, improving economic news and the promise of a rate cut are combining to become the perfect storm for U.S. stocks.
Which governments hold the most Bitcoin?
U.S., UK and Germany hold more Bitcoin than you may think.
According to the Arkham website, the United States’ government holds some 212,847 BTC making it one of the biggest holders of Bitcoin, while the treasuries of the U.K. and Germany reportedly hold around 61,245 BTC and 49,858 BTC each. (These values alter daily).
In addition to Bitcoin, the U.S. government also holds around $200 million in other cryptocurrencies like Ether (ETH), as well as major stablecoins like USDC.
U.S. Bitcoin holding by current value according to Arkham
Arkham, a crypto intelligence platform focused on deanonymizing entities on the blockchain network, has introduced a dashboard featuring the governments with the largest crypto holdings.
The U.K. government, reportedly ranked second, holds around $3.5 billion worth of Bitcoin at current valuations, according to Arkham’s data. The German government owns roughly $2.5 billion.
UK Bitcoin holding by current value according to Arkham
Other world governments holding Bitcoin
China, Russia, Ukraine, El Salvador, Finland, Bhutan and many others.
In 2021, El Salvador became the first country to make Bitcoin legal tender and mandated all local businesses to accept payments in BTC.
China’s exports beat forecast – but imports drop
In June 2024, China’s imports fell by 2.3% year-on-year in U.S. dollar terms, missing the expected 2.8% growth forecast by analysts.
However, exports rose by 8.6%, surpassing the anticipated 8% growth. This resulted in a 2% increase in year-to-date imports and a 3.6% rise in exports for the first half of the year compared to the same period last year.
Additionally, China’s trade with the Association of Southeast Asian Nations (ASEAN) surged by 7.1% in the first half of the year, solidifying ASEAN as China’s largest regional trading partner, followed by the European Union.
Trade with Brazil grew rapidly in the first half of the year, with Chinese exports to the country surging by 24.4%.
UN report suggests the world population to peak at 10.3 billion in 2028 – then decline
According to the organization’s biennial World Population Prospects report, the global population is projected to grow from 8.2 billion in 2024 to peak at around 10.3 billion in the mid-2080’s.
It is then expected to gradually decline to 10.2 billion by 2100, which is 6% lower than anticipated a decade ago.
The UN in 2022 had reportedly estimated the world population would peak at 10.4 billion by the 2080’s.
Front page of the UN World Population Report
See full report here.
U.S. inflation falls 0.1% from May to June 2024 further adding to speculation of an imminent Fed rate cut
The Consumer Price Index (CPI), a comprehensive gauge for goods and services costs, saw a 0.1% decrease from May 2024, bringing the annual rate to 3%, which is near its lowest point in over three years.
When removing the unstable food and energy prices, the core CPI rose by 0.1% monthly and 3.3% annually. This year-over-year core rate increment is the least since April 2021.
Inflation for the month was tempered by a 3.8% drop in gasoline (petrol) prices, which balanced out the 0.2% rises in both food prices and housing costs.
UK economy returns to growth in May 2024 with better figures than expected
In May 2024, the U.K. economy expanded by 0.4%, according to figures released by the Office for National Statistics on Thursday 11th July 2024.
The newly elected Labour Party will welcome this broad-based recovery as Prime Minister Keir Starmer begins his first week in office.
Following the announcement, Sterling surged to a four-month high against the U.S. dollar
Big Tech and AI stocks push S&P 500 and Nasdaq to new all-time highs!
On Wednesday, 10th July 2024, the S&P 500 reached a new record high, surpassing 5,600 for the first time, propelled by a significant surge in semiconductor stocks.
The S&P 500 index rose by 1.02%, ending the day at 5,633 and marking its seventh consecutive day of gains. The Nasdaq Composite increased, achieving a new all-time high closing at 18,647.
This year has seen the S&P 500 close at record highs some 37 times, with the Nasdaq following closely with 27 record high finishes.
S&P 500
Nasdaq Composite
The Dow Jones Industrial Average grew by 429 points, finishing at 39,721.
Note: figures rounded
Japan’s Nikkei blast through 42000 to reach all-time high
Japan’s Nikkei 225 surpassed the 42,000 threshold for the first time ever during a widespread increase in Asia-Pacific markets on Thursday 11th July 2024.
This surge followed a rally in U.S. Big Tech stocks, fueled by optimism over a potential Federal Reserve rate cut moving ever closer.
The Nikkei climbed almost 1% to close at 42,224 driven by gains in technology shares, while the comprehensive Topix index advanced to finish at 2,929.
Nikkei index
“One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors.” – Plato
Plato – was an ancient Greek philosopher of the Classical period who is considered a foundational thinker in Western philosophy and an innovator of the written dialogue and dialectic forms.
Plato’s most famous contribution is the theory of forms (or ideas). Along with his teacher Socrates, and Aristotle, his student, Plato is a central figure in the history of philosophy.
Visit Wikipedia for more information about Plato.
