🦢 Black Swan Street Weekly Stock Market Summary (July 31st - August 4th 2023)

Happy Friday!

United States gets downgraded, Manchester United extends deal with Adidas, Tesla investigation on Model 3 and Model Y steering wheels, Bank of England 14th straight rate hike.

… Let’s roll ↓

Here’s what we got for you this week:

• Stock Market Summary 🦢

• United States Downgrade ⬇️

• Meme Frenzy In The Markets 😹

• Other News In The Stock Market 🌎

• Next Week In The Stock Market 🔮

Read time: 4 minutes

Stock Market Summary 🦢

Performances This Week:

Earnings From This Past Week:

United States Downgrade ⬇️

Seen this before? It’s the different credit ratings from the three major US rating agencies: Moody’s, Standard & Poor’s, and Fitch. 

It’s essentially a grade given on a borrower’s creditworthiness and the level of risk involved in lending money to that particular borrower.

For the first time since 2011, Fitch lowered the United States rating to AA+ from AAA. This causes borrowing costs for the United States to rise and confidence to weaken. Not good.

At the current rate, nearly 25% of all government revenue will go toward interest expense by 2033. Crazy.

Here’s an interesting Twitter thread highlighting the disconnect between the stock market and the economy ↓

Also to note: The US Treasury increased the size of its quarterly bond sales for the first time in nearly 2 ½ years.

The Treasury will boost its quarterly refunding of long-term treasuries to $102 billion, from $96 billion.

Meme Frenzy In The Markets 😹

Meme stocks were moving this week…. and I mean moving.

Tupperware’s stock was the leader. The company announced it finalized an agreement with lenders to restructure existing debt obligations.

End of the day, it’s not a justified move. This is a company that’s on the verge of bankruptcy and has been flying this last month.

Also to note:

• Nikola shares have gained +95.11% in the past month

• AMC shares have gained +17.29% in the past month

Other News In The Stock Market 🌎

• Manchester United extends apparel-sponsorship deal with Adidas, 10-year $1.2 billion deal - CNN

• Adani Group in talks to raise $1.8 billion from India bond sales - BBG

• Francisco Partners & TGP to take New Relic private in $6.5 billion all-cash deal, valued at $87 per share - CNBC

• Birkenstock owner plans September IPO at $8 billion valuation - BBG

• Revolution Medicines to acquire EQRx in all-stock deal that will add $1 billion in cash - GNW

• BlackRock, MSCI being investigated by House Committee concerning flow of capital out of the US and into China - FB

• Uber delivers first-ever operating profit in recent earnings call - WSJ

• Zillow partners with Redfin for new construction listings - LBMJ

• Tesla under investigation for Model 3 and Model Y steering wheels that freeze up - TV

• US ADP Nonfarm Employment Change: 324k, from previous 455k, and above 189k forecast

• Wells Fargo, Bank of America to pay FDIC up to $3.7 billion combined for bank failure special assessment - MW

• China regulators propose ‘two-hour daily limit of smartphones’ for kids - CNBC

• Vici invests $150M in Canyon Ranch to expand resort portfolio - FB

• Spirit AeroSystems plunges 30% after disclosing $105 million in losses on Boeing and Airbus aircraft production and forecast a bleak cash flow picture for the rest of the year - RT

• Bank of England raises rates for 14th meeting in a row, base interest rate now 5.25% - BBC

• Warner Bros Discovery launches $2.7 billion buyback in attempt to slash debt - YF

• US money market funds draw biggest inflow in four months - RT

Next Week In The Stock Market 🔮

Earnings Calendar Next Week:

What the Swan is watching:

Monday: Tyson, Paramount, Palantir, Lucid, KKR, Aecom

Tuesday: UPS, AMC, Eli Lilly, Lyft, Fox, Rivian, NRG Energy, Twilio, Under Armour, Datadog

Wednesday: Roblox, Disney, Sony, Penn Entertainment, Wendy’s

Thursday: Alibaba, Ralph Lauren

Economic Calendar Next Week:

The Swan’s Picks 🦢

🚗 Uber joins the AI chatbot craze: Uber announced it’s developing an artificial intelligence-powered chatbot to integrate into its app. The purpose of the chatbot is to enhance customer service and automate tasks in the app.

🎥 Anti-Hollywood is the new Hollywood?: The Sound of Freedom is exploding (and rightfully deserved). For those out of the loop, it’s a movie focused on bringing awareness to the global sex trafficking problem.

It’s been so impactful that people are spending their own money to buy tickets for others to see it. See here. With an estimated budget of $14.6 million and zero A-list talent, it has raked in over $149 million in the US and Canada since its premiere.

🎬 Pornhub blocks all Arkansas users: The #1 porn site in the world goes dark in Arkansas. The website decided to disable access to the website from people in the state of Arkansas. According to the company, it’s in protest of an impending state law that will require Arkansas to verify their age to watch online pornography.

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The Wrap-Up 🔄

Sorry for the shorter edition this week. Truth is, I had some real-life personal issues come up that I had to deal with.

… But you better believe we’ll be back next Friday with a BANGER!

Black Swan Street Review of the Week ❤️