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- Weekly Wrap-Up - June 8th, 2024
Weekly Wrap-Up - June 8th, 2024
The jobs report, Nvidia and a roaring kitty?
CMG Venture & Mark Roussin
June 08, 2024
In partnership with
Good morning investors!
If this is your first time reading, welcome to The Investor’s Edge — a thriving community of more than 16,000 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.
Market Talk
The major indexes closed the week higher, with both the S&P and Nasdaq making new all-time highs.
3 Stories Moving the Market
These are some of the biggest stories from the second half of the week that had an influence on market action.
U.S. adds a much-better-than-expected 272,000 jobs in May, but unemployment rate edges up to 4%
In May, the U.S. economy added 272,000 jobs, significantly exceeding expectations of 190,000 and countering fears of a labor market slowdown, which likely reduces the Federal Reserve’s motivation to lower interest rates.
Nonfarm payrolls increased from 165,000 in April, surpassing the Dow Jones consensus estimate of 190,000. However, the unemployment rate rose to 4%, the first time above this level since January 2022, against expectations it would remain at 3.9%.
The labor force participation rate decreased to 62.5%, with the number of employed individuals falling by 408,000. Average hourly earnings also exceeded expectations, rising 0.4% for the month and 4.1% year-over-year, compared to the anticipated 0.3% and 3.9% increases.
Following the report, traders reduced the likelihood of a September rate cut to about 56%, according to the CME Group’s FedWatch measure.
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Nvidia passes Apple in market cap as second-most valuable public U.S. company
Nvidia surpassed Apple in market cap on Wednesday, becoming the second-most valuable public company behind Microsoft.
Nvidia reached a $3 trillion market cap after shares rose over 5%, closing with a market value of $3.019 trillion compared to Apple's $2.99 trillion. Microsoft's market cap stood at $3.15 trillion.
Nvidia shares have surged more than 24% since reporting first-quarter earnings in May and have significantly increased since last year. The company holds an estimated 80% market share in AI chips for data centers, driving substantial revenue growth, with its data center business revenue rising 427% year-over-year to $22.6 billion, representing 86% of total sales.
Conversely, Apple shares have risen only about 5% this year, with recent quarterly earnings showing a 4% overall sales drop and a 10% decline in iPhone sales. Apple faces strategic challenges in China, manufacturing issues, and mixed reactions to its new Vision Pro virtual reality headset.
Nvidia’s 10-for-1 stock split officially went into effect at the close of trading Friday.
📚 EDGE-UCATION: What is Market Cap?
Market cap, or market capitalization, is a measure of a company's total value as determined by the stock market. It is calculated by multiplying the current share price by the total number of outstanding shares. This metric is used to assess the size and value of a company in the market.
For example, if a company has 1 million shares outstanding and the current share price is $50, the market cap would be:
Market Cap = Share Price × Number of Shares Outstanding
Market Cap = $50 × 1,000,000 = $50,000,000
Market cap categories often used to classify companies include:
Large-cap: Companies with a market cap of $10 billion or more.
Mid-cap: Companies with a market cap between $2 billion and $10 billion.
Small-cap: Companies with a market cap between $300 million and $2 billion.
Micro-cap: Companies with a market cap between $50 million and $300 million.
Nano-cap: Companies with a market cap below $50 million.
Market cap is important because it helps investors understand the relative size of one company compared to another.
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Roaring Kitty’s GameStop holdings topped $1 billion before Friday’s livestream
Keith Gill, known as "Roaring Kitty" on X and "DeepFuckingValue" on Reddit, hosted his first livestream since the meme stock frenzy three years ago, reiterating his belief in GameStop's reinvention under CEO Ryan Cohen without offering new reasoning for his large stake.
Gill revealed he had no institutional backers and his shared GameStop positions were his only bets. Gill holds 120,000 call options with a $20 strike price expiring June 21, potentially worth $240 million.
During the stream, GameStop shares were halted multiple times and the stock fell nearly 40%.
Ahead of the stream, GameStop released a surprise first quarter earnings report, which was initially scheduled for next Tuesday. In the report, the company announced a significant first-quarter sales drop and that it plans to sell an additional 75 million shares, following a previous 45 million share sale that raised over $900 million.
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IE+ Posts of the Week
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.
Edge Report
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 the nonfarm payrolls report and shared our belief that markets will be subdued until the jobs report on Friday. See the latest full report here:
Top Stocks to Watch - June
At the beginning of each month we share our top stocks that we are watching in the weeks ahead. This week we released the fourth edition of this new report where we performed a full analysis of 10 stocks and shared our price targets.
We decided to unlock one stock’s analysis so everyone can see the value Edge+ members get. Get your sneak peek here:
Earnings Recaps
Every week during earnings season we share a recap of the quarterly reports from stocks that we cover. You can see this week’s earnings recaps here:
The Week Ahead
Next week is all about inflation and retail earnings.
Earnings Reports
Earnings season is winding down but there’s still a few names for us here at The Investor’s Edge that are scheduled to report. Here is the list of names we will be covering:
Monday 6/10: --
Tuesday 6/11: Oracle
Wednesday 6/12: Broadcom
Thursday 6/13: Adobe
Friday 6/14: --
Here is the full calendar of scheduled earnings releases:
Source: Earnings Whispers
Economic Reports
Next week will be a massive week in terms of economic reports and potential catalysts for market action. Two major inflation reports, the CPI and PPI, will be released while the Fed announces its latest rate hike decision.
We also get initial jobless claims, consumer sentiment and several speeches from Fed members.
The Investor’s Edge Discord is growing!
Our brand-new Discord server is growing quickly and we are excited to hear from so many intelligent minds!
The channel is tailor-made for investors like you who want to dive deeper into stocks, share insights, and engage directly with us.
Here's what happened in the Discord this week:
🗨️ Chat rooms: Investors discussed the the huge moves from names that reporting earnings like Crowdstrike, Lululemon and Dollar Tree, and shared their insights on the earnings. Members also dove into the number of jobs reports and shared their views on the overall economy.
🚨 Trade Alerts: Chris and Mark shared several trades, including additions to the portfolio and trades that set up their portfolios for the week, including an Amazon trade that made Mark a 114% profit in one day. Here’s a sneak peek 🤫
Join us on Discord and let's level up our investing game together. The future of trading awaits—and you're invited to be a part of it! 🌟
Want more? Check out our other resources
If you haven’t done so, check out the social media pages of our collaborators and give them a follow:
Mark (Dividend Seeker)
Chris (CMG Venture)
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
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.
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