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Good morning investors!

If this is your first time reading, welcome to The Investor’s Edge — a thriving community of more than 15,000 subscribers striving to be better investors with an edge in the market.

Every Wednesday we publish “The Mid-Week Wrap-Up” — your ticket to being well informed and staying ahead in the investment game!

This report is designed to help investors of all skill levels break down important stories/topics within the stock market. And best of all, we cut through all of the BS and give you exactly what you need to know in easy to digest, bite sized pieces of content.

This article is designed to truly give you that EDGE in the day ahead!

Grab your afternoon pick me up and let’s dive in.

Market Talk

The market is lower to start this week, with the major indexes all tumbling today after a hot inflation report.

3 Stories Moving the Market

These are some of the biggest stories so far this week that are having an influence on market action.

Fed Chair Powell says there has been a ‘lack of further progress’ this year on inflation

Federal Reserve Chair Jerome Powell stated that although the U.S. economy is robust overall, inflation still hasn't reached the central bank's 2% target, making interest rate cuts unlikely in the near future.

The Fed has maintained its benchmark interest rate between 5.25% and 5.5% since July 2023, the highest in over two decades. Due to higher-than-expected inflation data in early 2024, Powell emphasized that rates will likely remain unchanged until inflation approaches the target.

Financial markets had initially anticipated five rate cuts in 2024, but expectations have shifted due to evolving data, with 2-3 cuts now projected for the remainder of the year. However, the Fed's stance remains data-dependent, and policymakers haven't committed to specific reductions.

Treasury yields continue to rise as a result of inflationary concerns, with the 10 year sitting near 4.61% as of 12pm EST.

Berkshire Hathaway is on a seven-day losing streak, on pace to make it eight in a row

Berkshire Hathaway has been on a downward trend for the past seven trading days, marking its longest losing streak since December 2018.

During this period, the stock has lost -4.7% of its value, with today's decline contributing to potentially eight consecutive days of losses. This recent performance contrasts with the broader Financial Select Sector SPDR Fund ETF, which saw a decrease of -4.17% over the last seven trading days.

Berkshire is expected to announce Q1 earnings on May 3, with analysts expecting an EPS of $4.65, a 26.03% increase year-over-year increase, and revenue of $80.01B, or a decline of 6.30% from a year ago.

The company’s Q4 report that showed operating earnings rose by 28% compared to the previous year, primarily driven by improvements in insurance underwriting and investment income, as well as a record cash pile for the company, sitting at $167.6 billion at the end of 2023.

Despite the recent downturn, Berkshire Hathaway's stock is up +11.4% this year.

Tesla asks shareholders to vote again on Musk’s $56 billion payout

Tesla intends to seek shareholder approval to reinstate CEO Elon Musk's $56 billion pay package, which was previously voided by a Delaware judge due to its "deeply flawed" nature.

Tesla disputes the decision, alleging errors in fact and law and citing institutional stockholders who disagree with it. The company also plans to relocate its incorporation from Delaware to Texas, a move suggested by Musk following the court's ruling on his pay package.

The proposals are expected to face significant controversy, with Tesla hiring proxy solicitor Innisfree M&A to aid in securing votes. 

These decisions come amidst Tesla's recent announcement of a 10% reduction in its workforce.

The Second Half

The second half of the week will be about Fed speeches and earnings. Both will have significant influence on market action.

Earnings Reports

There are some major earnings still on the way this week. Here at The Investor’s Edge we will be watching Taiwan Semiconductor, Netflix and Procter & Gamble:

Here is the calendar of earnings releases scheduled for the rest of the week:

Economic Reports

Here is the calendar of events scheduled for the remainder of the week:

Fed speeches will be the center of attention as investors look for clues into interest rate projections for the remainder of the year. There will also be several housing reports, initial jobless claims and Philly manufacturing data.

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Thank you for reading this edition of the Mid-Week Wrap-Up.

Until next time investors!

Mark & Chris

The Investor’s Edge

Disclosure

This is not investing advice. It is very important that you do your own research and make investments based on your own personal circumstances, preferences, goals and risk tolerance.