📈 Unwinding of carry trade

Intel sued by shareholders alleging securities fraud, JPMorgan says three quarters of global carry trade unwound, Warner Bros. Discovery takes massive $11.2B in write-downs, Disney flags startling shift in consumer behavior, and Dimon still sees a recession on the horizon…

Author

Smart Owl
August 08, 2024

Good morning.

The Fast Five → Intel sued by shareholders alleging securities fraud, JPMorgan says three quarters of global carry trade unwound, Warner Bros. Discovery takes massive $11.2B in write-downs, Disney flags startling shift in consumer behavior, and Dimon still sees a recession on the horizon …

Calendar: (all times ET)

  • Today: Initial jobless claims, 8:30 AM

  • Tomorrow: no notable events

Your 5-minute briefing for Thursday, August 8:

BEFORE THE OPEN

As of market close 8/7/2024.

PRE-MARKET

MARKETS

  • US stocks closed lower as a market comeback failed to materialize

  • Europe's Stoxx 600 rose 1.5% in its best day since November

  • US 2Y-10Y yield curve inversion is now at just -2 bps

  • Junk spreads surged to 393 bps on Monday, their highest since November

  • Investment grade spreads rose to 112 bps, their highest since December

  • Yen fell 2.5% after BOJ played down chances of a near-term rate hike

EARNINGS

  • Disney beat Q3 EPS and revenue estimates as its combined streaming businesses turned a profit sooner-than-expected, though theme parks saw a slowdown on lower consumer demand (link)

  • Shopify jumped 18% after beating Q2 estimates and forecasting an upbeat Q3 on strong demand despite a 'mixed consumer spend environment’ (link)

  • Robinhood beat Q2 EPS and revenue estimates on a surge in trading volume among crypto and equities (link)

  • CVS beat Q2 EPS estimates but slashed its FY outlook again due to climbing medical costs across the industry (link)

  • What we're watching this week:

    • Today: Eli Lilly

  • Full calendar here

NEWS BRIEFING

Intel was sued Wednesday by shareholders who said it fraudulently concealed problems that led to weak second-quarter results, suspend its dividendk and cut its workforce by 15%.

Three-quarters of the global carry trade has now been removed, with a recent selloff erasing this year’s gains.

  • Traders brace for more S&P volatility after jobless claims (link)

  • Traders lose billions on big volatility short after stocks rout (link)

  • Dimon still sees a recession on the horizon (link)

  • Asia markets mixed as Wall Street recovery stalls (link)

  • Dollar down as rate cut bets rise, yen surges (link)

  • China’s move away from the USD (link)

  • Warner Bros. Discovery takes massive $11.2B in write-downs (link)

  • Disney flags startling shift in consumer behavior at theme parks (link)

  • JPMorgan raised US recession odds to 35% by year-end (link)

  • US corporate bond issuance jumped after a brief pullback (link)

  • US 30-year mortgage rates dropped to a 15-month low (link)

  • Department stores fall behind in retail real estate comeback (link)

CRYPTO

  • Ripple Labs was fined $125M for selling XRP tokens to institutional investors (link)

  • Ether pulls back again following slight rebound with other risk assets (link)

  • MicroStrategy’s Saylor says he personally owns $1 Billion in Bitcoin (link)

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