Black Swan Street: Stock Market Weekly (July 29-August 2 2024)

Welcome to Black Swan Street!

Welcome back!! It’s @KeatonInglis here with another edition of Black Swan Street…

Let’s get into it:

• Troubles at Intel📉

• The Swan’s Selections🦢

• In Other News🗞️

• This Week Upcoming In The Stock Market🔮

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Read time: 5 minutes

Troubles at Intel📉

0%.

That’s the return Intel’s stock has had since 1997.

Intel's recent earnings report has sent shockwaves through the semiconductor industry. The once-dominant chipmaker's financial performance in the second quarter of 2024 paints a grim picture, leaving investors and analysts questioning the company's ability to regain its footing in an increasingly competitive landscape.

Intel reported a revenue decline of 1% year-over-year, bringing in $12.8 billion for the quarter. More alarmingly, the company swung to a net loss of $1.61 billion, a dramatic reversal from the $1 billion profit recorded in the same period last year.

The market's reaction was swift and brutal. Intel's stock plummeted 26% in a single day following the announcement, marking its worst performance since 1974. This precipitous decline not only erased billions in market value but also dragged down other semiconductor stocks globally, highlighting the interconnected nature of the tech ecosystem.

Intel's management has responded with a series of drastic measures aimed at stemming the bleeding. A $10 billion cost-cutting initiative, including a 15% reduction in workforce, signals the company's desperation to right the ship. The suspension of its dividend, a move that will undoubtedly ruffle long-term investors' feathers, underscores the severity of Intel's cash conservation efforts.

The company's long-term stock performance tells an equally sobering tale. Since 1997, Intel's stock price has remained remarkably flat, a damning indictment of its inability to capitalize on the tech boom that has enriched many of its peers.

However, amidst the gloom, Intel is pinning its hopes on several key initiatives. The company is betting big on AI and data center solutions, although progress in these areas has been slower than anticipated. Additionally, the planned launch of its Intel 18A process technology next year is positioned as a potential game-changer, aimed at reclaiming Intel's leadership in process technology and boosting profitability.

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The Swan’s Selections🦢

💰US wage inflation slowed to a 3.5-year low: The latest numbers show labor costs only went up a smidge in Q2, with private sector wages growing at the slowest rate we've seen in over 3 years. This, plus some other good news on inflation, has got everyone buzzing about a possible interest rate cut from the Fed. Even Fed Chair Powell seems pretty chill about it, saying they're feeling more confident that inflation's heading in the right direction. Wall Street's getting excited - could we see cheaper borrowing on the horizon? Keep your eyes peeled for the Fed's next move in September!

🎰DraftKings to tax winning bets in high-rate states in a bid to boost profit: This comes right as they're celebrating their first profitable quarter since going public, raking in a cool $1.1 billion in revenue. The surcharge is aimed at states charging over 20% in betting taxes, and while CEO Jason Robins says it'll be pocket change for most bettors, it's still a risky play. If you weren’t sick of tipping culture prior…

🍔US targets surging grocery prices in FTC probe: The FTC, like you and me, are wondering why food prices are still sky-high even though it's getting cheaper for stores to stock their shelves. The big boss at the FTC, Lina Khan, says they're gonna make the big players like Walmart and Whole Foods spill the beans on their costs and prices - as prices have shot up 25% in just four years.

In Other News🗞

• Short seller Andrew Left is facing criminal charges (CNBC)

• Funding surge for SPACs are pointing to a bounceback (FT)

• Home insurers suffered their worst loss since 2000 last year (FT)

• Deadpool & Wolverine blew past a box office record (WSJ)

• Apple does not use Nvidia chips to train its AI models (RT)

• The post-Covid factory boom is running out of steam (WSJ)

• Meta settled for $1.4B in privacy case with Texas (WSJ)

• Nvidia is down 25% from its peak (FRB)

• US job openings held steady defying recent slowdown trend (BBG)

• US national debt topped $35T for the first time ever (NYT)

• Kamala Harris is polling better than Trump in swing states (BBG)

• 2024 Olympics ad revenue hit a record high (BBG)

This Week Upcoming in the Stock Market🔮

Earnings Calendar This Week:

Economic Calendar This Week:

The Wrap-Up🔄

🎊🎉 That’s it for today 🎉🎊

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Per usual, let us know what you thought!!⬇️