OpenAI has partnered with the global magazine conglomerate Condé Nast to enable ChatGPT and its search engine, SearchGPT, to showcase content from renowned publications such as Vogue, The New Yorker and GQ.
The agreement represents the most recent in a series of deals made by OpenAI with prominent media companies.
The material generated by media organizations is coveted by tech companies for training their AI (Artificial Intelligence) models.
Several media companies, such as the New York Times and the Chicago Tribune, have opposed this practice and have pursued legal measures to safeguard their content.
The financial details of the contract between OpenAI and Condé Nast were not revealed.
Highs and lows of one volatile week in the U.S. stock market
U.S. stocks climbed on Monday 19th August 2024, continuing the market’s rebound as investors prepared for the highly anticipated Federal Reserve symposium at Jackson Hole later in the week.
The S&P 500 ended the day at 5608
The S&P 500 ended the day at 5608
The Nasdaq Composite surged to finish at 17876
Both the S&P 500 and Nasdaq achieved their eighth consecutive day of gains, a record for 2024
The Dow Jones Industrial Average gained 236 points closing at 40896.
However, encouraging data last week appeared to calm the markets and raised hopes for a ‘soft landing’ of the economy. Positive figures in retail sales and initial jobless claims, along with robust earnings from Walmart, contributed to this optimism. Additionally, the annual inflation rate for July’s consumer price index reached its lowest point in over three years.
The video game industry is experiencing sluggish growth in 2024 for several reasons
Slow console sales
Gaming console sales have not met expectations. For example, sales of Sony’s PlayStation 5 have decreased from 3.3 million units in the same period last year to 2.4 million units in the fiscal first quarter of 2024.
Post-Pandemic
The gaming industry experienced a substantial increase during the COVID-19 pandemic due to people staying indoors more often. Yet, with the easing of restrictions, there has been a noticeable change in consumer habits, with a trend towards increased outdoor activities.
Economic considerations
Increased interest rates and inflation have diminished discretionary income, leading to a decrease in consumer spending on games.
Challenges
The industry has faced mass layoffs and other operational challenges, which have impacted growth.
Despite these challenges, there are optimistic projections for 2025 with anticipated major releases like the eagerly awaited successor to Nintendo’s Switch console and Grand Theft Auto (GTA) VI.
Future
Predictions for 2025 suggest that the new Nintendo console and GTA VI will make a significant impact, potentially revitalizing the industry.
The U.S. and China account for around half of consumer spending on games.
The gaming industry as a whole is currently estimated to be worth around $188 billion globally and this is projected to grow in 2025.
Intel has divested its 1.18 million share stake in the British chip company Arm Holdings, according to a regulatory filing.
Intel is undergoing significant restructuring and cost-cutting to address competitive challenges in the semiconductor industry.
The recent transaction, disclosed on Tuesday 13th August 2024, is believed to have earned Intel approximately $147 million, based on Arm’s average share price between April and June 2024.
This move away from Arm occurs during a challenging financial phase for Intel, as it embarks on what CEO Pat Gelsinger reportedly describes as “the most extensive restructuring of Intel since the memory microprocessor transition four decades ago.”
In early August, Intel announced a cost-reduction plan designed to save $10 billion. This includes the layoff of about 15,000 employees, the elimination of the fiscal fourth-quarter dividend, and a reduction in capital expenditures.
At the same time, Intel disclosed quarterly figures that fell short of expectations and provided conservative guidance for the upcoming quarter.
This announcement precipitated the steepest single-day decline in Intel’s stock value in half a century, plummeting 26%.
Japanese stocks led gains across Asia on Friday 16th August 2024, poised for their best week in four years, with the Nikkei 225 climbing over 3% following a Wall Street rally.
The surge came as new economic data alleviated concerns of a U.S. recession.
In the U.S., retail sales saw a 1% increase in July, significantly exceeding the Dow Jones estimate of a 0.3% rise. Additionally, weekly jobless claims experienced a decline.
The S&P 500 ended up 1.61% at 5,543.22, marking its sixth consecutive gain. The S&P 500 index has risen approximately 8% from its intraday low on 5th August 2024 – one year chart
The Nasdaq Composite escalated 2.34% to 17594 – one year chart
Positive U.S. economic data
Retail sales saw a 1% increase in July 2024, significantly exceeding the prediction of a 0.3% rise. Additionally, the number of weekly jobless claims dropped. This data provided a boost to investors and the broader market, which is recovering from an August downturn linked to worries over a slowing economy, sparked by a disappointing U.S. jobs report on 2nd August 2024.
With over a 3% increase this week, the S&P 500 is now just about 2% shy of its record high. All three major U.S. indexes are trading above their 2nd August closing levels, which preceded the global stock market plunge on 5th August.
Falling commodity prices can be a signal of economic trouble ahead
When commodity prices drop, it often reflects a decrease in demand for raw materials, which can be a sign of slowing economic activity. For instance, the recent decline in copper prices is seen as a potential indicator of economic slowdown.
Sugar, cotton, soybean, oil and iron ore are some examples where demand has fallen during this year.
However, it’s important to consider other factors as well. The global economic slowdown has reduced demand for energy, minerals, and agricultural products. While this trend is evident in many countries, the U.S. economy has shown some resilience.
So, while falling commodity prices can be a warning sign, they are just one piece of the puzzle. It’s essential to look at a broader range of economic indicators to get a complete picture.
Stocks rose on Thursday 8th August 2024 as the latest U.S. employment data bolstered investor confidence in the economy, following a significant market downturn earlier in the week.
The S&P 500 increased by 2.3%, closing at 5319.31, marking its best day since November 2022. The Dow Jones Industrial Average jumped by 683.04 points to 39446.49.
S&P 500 5-day chart as of 8th August 2024
S&P 500 5-day chart as of 8th August 2024
The Nasdaq Composite climbed to 16660.02. And all these gains just 4 days after the market rout on Monday 5th August 2024.
The most recent weekly unemployment claims were lower than expected, easing some of the recent worries about the U.S. labour market.
The initial claims for unemployment benefits last week were 233,000, a decrease of 17,000 from the previous week.
During the day, the Dow had surged around 480 points, the S&P 500 had climbed 1.73%, and the Nasdaq had risen over 2%.
Dow Jones one day chart 7th August 2024
Dow Jones one day chart 7th August 2024
S&P 500 one day chart 7th August 2024
S&P 500 one day chart 7th August 2024
Nasdaq Composite one day chart 7th August 2024
Nasdaq Composite one day chart 7th August 2024
However, a downturn in Nvidia and other major tech stocks, after an initial rise, led to a significant drop in the afternoon. Nvidia retracted by 5.1%, Super Micro Computer plummeted 20.1% following its fiscal Q4 earnings missing analyst predictions, Tesla fell 4.4%, and Meta Platforms decreased by 1%.
Nvidia one day chart 7th August 2024
Nvidia one day chart 7th August 2024
One month chart Super Micro Computer 7th August 2024
One month chart Super Micro Computer 7th August 2024
Nvidia one day chart 7th August 2024
Nvidia one day chart 7th August 2024
The U.S.10-year Treasury yield continued to rise, increasing by about six basis points to 3.95%, returning to its level before the disappointing job figures last Friday, which had sparked concerns of an economic slowdown.
The Volatility Index (CBOE), the so called ‘fear gauge‘ was trading at around 29, having dropped to as low as 22 earlier in the day. This sharp decrease from Monday 5th August 2024 suggests that investor fears are subsiding, however, they remain higher than at the beginning of the month.
U.S. shares gained on Tuesday 6th August 2024, signalling a tentative stabilisation in global markets after a period of significant declines.
The Nasdaq, known for its tech-centric portfolio, along with the Dow Jones Industrial Average and the S&P 500, all ended the day in more positive territory.
This ‘lift’ came after a period of muted activity in UK and European markets, with London’s FTSE 100 experiencing an initial surge before retreating.
The recent turmoil in the stock market was triggered on Friday 2nd August 2024 by unsatisfactory U.S. job data for July 2024, which indicated an increase in unemployment, raising alarms over a potential recession.
Additionally, there has been growing apprehension that stocks of major technology firms, especially those with significant investments in artificial intelligence (AI), may have been excessively valued, leading to challenges for some of these companies.
On Monday 5th August 2024, stocks plummeted, marking the Dow Jones Industrial Average’s worst performance in nearly two years, igniting a worldwide market downturn due to concerns about the U.S. economy’s stability.
The Dow fell 1033.99 points closing at 38703. The Nasdaq Composite dropped to close at 16200, while the S&P 500 declined 3%, ending the day at 5186. Both the Dow and S&P 500 experienced their most significant daily losses since September 2022.
The primary driver of the worldwide market collapse was the fear of a U.S. recession, triggered by the disappointing July jobs report released on Friday.
Additionally, there is growing concern among investors that the Federal Reserve has delayed reducing interest rates to support the slowing economy.
The seven most valuable U.S. tech companies experienced a combined loss of $1 trillion in market value at the start of Monday’s trading session – 5th August 2024
The Nasdaq declined over 3% following its sharpest three-week drop in two years.
Nvidia’s shares fell approximately 6%, while Apple’s dropped more than 4%.
On Monday, as the U.S. markets commenced trading, the market capitalization of the largest tech companies plummeted by about $1 trillion, exacerbating a decline that pushed the Nasdaq into correction territory the previous week.
Markets go up and markets go down
In early trade Nvidia’s market cap decreased by over $300 billion, but it swiftly regained about half of that loss. The chipmaker’s shares ultimately closed down 6.4%, equating to a $168 billion loss. Apple and Amazon saw their valuations fall by $224 billion and $109 billion at market open. Apple’s market cap finished 4.8% lower, a $162 billion decrease. Amazon’s valuation fell by 4.1% at closing, a $72 billion reduction.
Including significant drops in Meta, Microsoft, Alphabet, and Tesla, the top seven tech giants saw a $995 billion loss in market value in the initial moments of trading, although they did recover somewhat as the day went on.
Warren Buffett’s Berkshire Hathaway significantly reduced its Apple stake last quarter, a surprising decision from the investor known for his long-term focus.
The conglomerate, headquartered in Omaha, reported in its earnings filing that its investment in the tech giant was worth $84.2 billion at the end of the Q2, indicating it sold just over 49% of its Apple shares. Despite the sale, Apple remains Berkshire’s largest equity holding by a wide margin.
It was widely reported that the sale is part of a larger trend of asset liquidation by Buffett during the second quarter, with Berkshire Hathaway divesting over $75 billion in stocks, thereby increasing its cash reserves to a staggering $277 billion.
Japanese stocks entered a bear market on Monday 5th August 2024 as the sell-off in Asia markets continued from the previous week. The Nikkei 225 fell over 12%
These benchmark indices have now declined more than 20% from their peak on 11th July 2024 – the index then touched 42000.
The Nikkei suffered over a 12% loss, closing at 31458, marking its worst performance since the ‘Black Monday’ of 1987. This drop of 4451 points is also the largest point loss in its history.
Year to date, the Nikkei has relinquished all its gains, shifting into a negative territory.
Nikkei one year chart
Nikkei one year chart
Nikkei one day chart – down 12.4% on the day a total of 4451 points
Nikkei one day chart – down 12.4% on the day a total of 4451 points
Japan’s benchmark indices plummeted on Friday 2nd August 2024, with most Asia-Pacific markets lower after a sell-off on Wall Street created recession worries.
The Nikkei 225 index plunged around 5.80% to close at 35909, its most significant fall since March 2020, dipping below the 36000 for the first time since January 2024.
Amazon offers weak guidance citing Olympics and the Trump assassination attempt as cause (consumers are distracted). However, Amazon’s cloud unit reports 19% revenue growth, topping estimates and a 20% increase in business in Q2. Amazon stocks pull back after guidance update.
Intelendures a 22% share plunge dragging down other global microchip stocks from TSMC, ASML to Samsung. Company to cut 15% of workforce, reports quarterly guidance miss.
Meta shares climb 6% on positive earnings data and good revenue forecast. Zuckerberg enthused over AI and how it’s helping create profits suggesting ‘Meta’s advertising growth is proof that BIG AI spending is already paying off.’ However, Meta’s Reality Labs posts $4.5 billion loss in second quarter.
Nintendo profit falls 55% as sales of its ageing Switch console plunge. Nintendo revenue and profit plunged in Q1 as sales of its ageing Switch console decline. Nintendo sold 2.1 million units of its Switch consoles, down 46% on the year. Investors are seeking news surrounding a successor to the Nintendo Switch console.
Apple sales climbed 5%, topping estimates as iPad and services revenue lift despite ongoing issues with iPhone sales slipping in China. Apple is spending more on AI but remains way behind its peers.
Snap shares plunge more than 20% on weak guidance.
Qualcomm beats estimates as phone microchip sales up 12%.
Samsung Q2 revenue and profit comes in above estimates amid strong AI demand.
AMDjumps 5% as global microchip stocks rally. Data centre sales doubled.
Arm results exceeded expectations, but earnings guidance disappointed.
The chip-design company has ceased disclosing the quarterly shipment numbers of its chips.
Arm’s shares dropped over 13% in after-hours trading on Wednesday following the chip-architecture firm’s announcement of modest earnings projections for the current quarter and the entire fiscal year.
Total revenue was a record $939 million, up 39% year-on-year
Royalty revenues were up and amounted to $467 million, this represents a 17% increase.
Licence and other revenue was $472 million, up 72% year-on-year.
Arm’s revenue increased by 39% year-on-year for the quarter ending 30th June 2024, as reported in a shareholder update. The net income reached $223 million, a significant rise from the previous year’s $105 million.
Arm has kept its full year forecast unchanged, projecting revenues between $3.8 billion and $4.1 billion.
For the upcoming fiscal Q2, Arm anticipates revenues ranging from $780 million to $830 million. This projection suggests no mid-range growth, contrasting with some analysts’ expectations of $804.1 million in revenue.
Arm Holdings one day share price mid-day 1st August 2024
Arm Holdings one day share price mid-day 1st August 2024
Rolls-Royce shares surged over 11% to reach a record high on Thursday 1st August 2024 following the reinstatement of its dividend and an increase in its profit outlook, buoyed by robust first-half results
The British aerospace and defence giant announced an underlying profit of £1.1 billion for the first half of the year and projected this to grow to between £2.1 billion and £2.3 billion for the full year of 2024.
This projection surpasses the previous forecast of £1.7 billion to £2.0 billion made in its full-year results for 2023 and exceeds market expectations.
Rolls-Royce one-year share price as of: 1st August 2024 (12pm)
Rolls-Royce one year share price as of: 1st August 2024 (12pm)
Shares in the Dutch company ASML soared by around 10% on Wednesday 31st July 2024 following a Reuters report indicating that the firm might be exempt from the broadened export restrictions on chipmaking equipment to China.
Additionally, it was also reported that the U.S. is contemplating an expansion of the foreign direct product rule.
U.S. chip export restrictions to China could exclude allies such as the Netherlands, Japan, South Korea, Israel, Taiwan, Singapore and Malaysia. Taiwan is the home of TSMC, the world’s biggest chip manufacturing plant.
AMD
Shares of global semiconductor companies surged on Wednesday 31st July 2024, lifted by positive earnings within the sector and reports suggesting potential easing of U.S. export restrictions to China.
AMD emerged as one of the standout performers, with its shares climbing over 9% in U.S. premarket trading following a robust second-quarter earnings report.
Microsoft reported better-than-expected earnings and revenue for Q4
In extended trading on 30th July 2024, the stock experienced a quick decline as attention was drawn to the less-than-expected Azure revenue, despite management’s forecast for growth in the upcoming quarters.
The company’s total revenue saw a 15% increase compared to the previous year.
Despite surpassing earnings and revenue expectations, Microsoft’s shares dropped by up to 7% in extended trading on Tuesday, with investors concentrating on the underwhelming cloud revenue. However, executives offered a positive outlook, anticipating an acceleration in cloud growth during the first half of 2025.
Microsoft one day chart 30th July 2024
Microsoft one day chart 30th July 2024
Microsoft’s cloud division holds significant interest for investors, as it competes with Amazon Web Services (AWS) and Google in the artificial intelligence (AI) work arena. These three tech giants are pouring substantial resources into enhancing AI capabilities, aiming to attract both startups and established companies as generative AI technology swiftly progresses.
For Amazon, AWS has served as a vital profit centre for the past ten years.
Gold has been a popular investment for centuries. The allure of gold endures in today’s varied financial environment. We will delve into the advantages and disadvantages of investing in gold, as well as the different methods by which you can incorporate this valuable metal into your investment portfolio.
Pros of investing in gold
Protection against market downturns
Gold is viewed as a safe-haven asset. In times of market crashes or economic instability, investors tend to turn to gold to protect their savings and investments. For example, during the financial crisis of 2008, the price of gold soared by more than 100%, contrasting sharply with the losses experienced by other assets.
One year gold price chart as of 26th July 2024
One year gold price chart as of 26th July 2024
Inflation hedge
As inflation increases, the purchasing power of the dollar diminishes. During periods of high inflation, gold often appreciates, offering a potential return for investors.
Diversification
Diversifying an investment portfolio across various assets can help in minimizing losses. Gold, which usually has a low correlation with stocks and bonds, can bolster diversification and diminish overall risk.
Cons of investing in gold
No income generation
In contrast to stocks, which distribute dividends, or bonds, which accrue interest and can appreciate (or depreciate) in value, gold does not produce income. It’s worth is dependent entirely on its appreciation in price.
Additional costs
Owning and storing physical gold involves various expenses. These include transportation costs, storage fees, and insurance, especially if the gold is kept at home.
Ways to invest in gold
Physical gold
You can buy gold bars or coins. Owning physical gold provides tangible ownership and is a classic tried and tested way to invest.
Gold Mining Stocks
Investing in shares of gold mining companies can be a strategic move, as these stocks are impacted by gold prices and the operational performance of the mines.
Gold Exchange-Traded Funds (ETFs)
ETFs track the price of gold. They’re an efficient way to invest without holding physical gold.
Gold mutual funds
These funds aggregate investors’ capital to invest in assets related to gold.
Options and futures contracts
For more advanced investors, trading gold options and futures can provide exposure to price movements.
Conclusion
Gold can be a valuable addition to your investment strategy, especially for long-term goals. Consider your risk tolerance, financial objectives, and the role gold plays in diversifying your portfolio. Remember that while gold has held its value over time, it’s not a guaranteed path to wealth. As with any investment, thorough research and a well-thought-out approach are essential.
Apple has been ousted from the top five smartphone vendors in China during Q2, as local brands like Huawei continue to escalate competition
Apple is no longer among the top five smartphone vendors in China as local brands take over the market.
Apple’s market share in China has declined, falling to 14% in the second quarter from 15% in the first quarter and 16% 2023.
For the first time in history, domestic vendors have taken over all top five positions in China.
According to reports, incorporating Apple’s Intelligence systems in its products in mainland China will be crucial over the next 12 months, as Chinese brands are rapidly integrating generative AI into their designs.
This is not good news for Apple. The company is facing challenges, notably lagging behind in the AI innovation race, and compounded by a rapidly falling share of the mobile market in China.
OpenAI on Thursday 25th July 2024 announced a prototype of its search engine, called SearchGPT, which aims to give users “fast and timely answers with clear and relevant sources.”
The company has announced plans to eventually incorporate the tool, presently in testing with a select user group, into its ChatGPT chatbot.
The introduction of ChatGPT could have significant implications for Google’s search engine dominance. Since ChatGPT’s debut in November 2022, there has been growing concern among Alphabet’s investors that OpenAI may capture a portion of Google’s market share by offering consumers innovative methods to obtain information on the internet.
Alphabet three month share price as of 25th July 2024
Alphabet three month share price as of 25th July 2024
OpenAI’s ChatGPT was incorporated into Microsoft’s search engine Bing as Copilot and the companies have kept market dominance with this shrewd AI move. Google, on the other hand, has struggled to keep up in the AI race and may now be suffering the effects.
This announcement could have implications for Microsoft’s Copilot as well.
Kering, the owner of Gucci, experienced a drop in its share value on Thursday 25th July 2024 following the announcement of a significant revenue decrease in the first half of the year, coupled with a subdued outlook for the latter half.
Kering’s shares fell by up to 9% as the markets opened, trading at levels not seen since August 2017.
Kering one year share price chart 24th July 2024 (am)
Kering one year share price chart 24th July 2024 (am)
The luxury group announced late Wednesday 24th July 2024 that its revenue dropped by 11% in the first half of 2024, in comparison to the same period the previous year. The company reportedly attributed the decline to a slowing market in most regions, with the exception of Japan.
Kering are not alone in suffering a drop in share value, as luxury brands including LVMH and Burberry also experienced weaker trade declines noted in recent reports.
A deceleration of luxury purchases in China is cited as one of the major reasons for the declines.
Stocks sold off Wednesday 24th July 2024, blighted by underwhelming reports from Tesla and Alphabet – leading the Nasdaq Composite and the S&P 500 to post their worst sessions since 2022.
The S&P 500 index dropped to closing at 5427, while the tech-heavy Nasdaq slid around 3.65% to end at 17342. The Dow Jones Industrial Average shed 504 points closing at 39853.
Nasdaq Comp one day chart 24th July 2024
Nasdaq Comp one day chart 24th July 2024
Shares of Google parent company Alphabet fell 5% for their biggest one-day drop since 31st January, when they dropped 7.5%. Although Alphabet reported good numbers, YouTube advertising revenue came in below the consensus estimate causing share to dip.
Alphabet one day chart 24th July 2024
Tesla shares declined around 12% – their worst day since 2020 – on weaker-than-expected results and a 7% year-on-year drop in auto revenue.
