Good morning investors!

If this is your first time reading, welcome to The Stock Investor’s Edge — a thriving community of over 30,000 subscribers striving to be better investors with an edge in the market.

Every weekend we publish “The Weekly 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.

Grab your coffee and let’s dive in.

It was a tale of two markets this week, with mega cap tech and the AI trade getting hammered, while B.O.R.I.N.G. stocks ended the week in the green. Is this the start of a rotation or just a cooldown in the AI trade?

These are some of the biggest stories from the second half of the week that had an influence on market action.

Micron Technology $MU ( ▼ 1.24% ) reported a massive fiscal Q3 beat across revenue, earnings, and margins, and provided massive guidance. The stock ended the week roughly flat.

For full breakdowns of all earnings, including graphics and all key takeaways. head to the earnings channel in our Discord.

The Fed’s preferred inflation gauge rose to its highest level since early 2023, driven by a surge in energy prices tied to the US/Iran war. The Federal Reserve, under new Chair Kevin Warsh, has already signaled it may raise interest rates later this year if prices do not cool. Consumer spending and income both came in stronger than expected, showing Americans are still opening their wallets despite higher prices.

🔑 Key Points

👀 What You Need to Know

Inflation is running more than double the Fed's 2% target, and the energy shock from the Iran conflict is starting to spread into everyday services, which tend to be stickier and harder to control. The Strait of Hormuz reopening have pulled oil prices lower in June, but that relief will not show up in data for weeks. The Fed has made clear it will act if prices do not come down.

📚 Edge-ucation: What is PCE vs. Core PCE?

PCE, or Personal Consumption Expenditures, is the Federal Reserve's preferred measure of inflation. It tracks what Americans spend across goods and services each month, giving a broader read on prices than CPI.

When both headline and core are rising together, inflation is broad and not driven by a single event. That combination gives the Fed less reason to wait before acting on rates.

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Apple $AAPL ( ▼ 0.29% ) raised prices on its Mac and iPad product lines Thursday, with some models increasing by more than twenty percent overnight, marking the first time the company has raised prices on existing products at this scale. Microsoft $MSFT ( ▲ 0.19% ) announced the same day that Xbox console prices will rise by up to one hundred fifty dollars starting August first. The increases follow months of surging memory and storage chip costs.

🔑 Key Points

👀 What You Need to Know

The memory chip shortage is being driven by a massive shift in how chips are made and who gets them first. AI companies are locking up supply years in advance, leaving manufacturers of phones, laptops, and gaming consoles with less to work with and higher prices to pay. Apple and Microsoft absorbed these costs for as long as they could, but both companies have now confirmed that era is over and costs will be passed on to the consumer.

We just performed a full deep dive on Microsoft - read it here.

In this section, we'll be curating a selection of news headlines we think you'll find interesting. If a topic catches your eye, click the provided links to read more about it.

We continue to push out more and more content every week to give investors that edge. Here are the posts Investor’s Edge+ subscribers received this week.

Mondays are for the investors. Every Monday morning we share exactly what we’re watching in the week ahead, how we’re positioning, and even share a sneak peek into our systems and models. This week we discussed Micron’s earnings preview, the upcoming PCE inflation report, and our thoughts on the state of the overall market. See the latest full report here:

Next week is another holiday shortened week with the market closed on Friday to observe the 4th of the July (on Saturday). It is a quiet week on the earnings front, but the labor market will be front and center for markets as investors look for clues on how the Fed will proceed with interest rates, and the labor market being the second mandate certainly holds a lot of weight in that decision.

Earnings season is in the rear view and we get a nice lull before the next season ramps up. Here is the full calendar of scheduled earnings releases:

Nike is the only stock we cover that is expected to report, which will be on Tuesday after the bell.

Next week will be all about the labor market, with nonfarm payrolls, unemployment, ADP, JOLTs, and initial jobless claims scheduled for release.

We also get several housing reports and PMI data.

Here is the full calendar of events we will be watching:

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🗨️ Chat rooms: Investors discussed the the huge moves from mega cap tech. Members also dove into the number of jobs reports and shared their views on the overall economy.

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Thank you for reading this edition of the Weekly Wrap-Up. Have a great weekend!

Until next time investors!

Mark & Chris

The Investor’s Edge

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.