In partnership with

Welcome Back,

Market Headlines 👀 

• S&P 500 (SPX) stocks rally and all three major indices close green for the day.

• Alphabet (GOOGL) loses a major anti-trust DOJ case over its search monopoly.

• Microsoft (MSFT) responds to Delta Airlines by saying the company refused helping during outage from Crowdstrike.

• X (TWTR) brings forward an anti-trust lawsuit against advertisers over boycotting ad spend on the platform.

• Walt Disney (DIS) raises its streaming services prices by about 25%.

• Dell Technologies (DELL) reports layoffs across its sales team which may impact thousands of employees.

Earnings 💸

• Uber (Uber)

  • EPS: $0.74 beats (exp. $0.53)

  • Revenue: $10.7b beats (exp. $10.58b)

• Super Micro Computer (SMCI)

  • EPS: $6.25 misses (exp. $8.10)

  • Revenue: $5.31b meets (exp. $5.31b)

  • 10:1 stock split announced during earnings release*

• Rivian (RIVN)

  • EPS: $-1.27 beats (exp. $-1.40)

  • Revenue: $1.12b misses (exp. $1.15b)

• Reddit (RDDT)

  • EPS: $-0.06 beats (exp. $-0.33)

  • Revenue: $281.2m beats (exp. $253.58m)

• Airbnb (ABNB)

  • EPS: $0.86 misses (exp. $0.92)

  • Revenue: $2.75b beats (exp. $2.74b)

• Coupang (CPNG)

  • EPS: $0.07 beats (exp. $-0.01)

  • Revenue: $7.32b misses (exp. $7.4b)

• Celius (CELH)

  • EPS: $0.28 beats (exp. $0.23)

  • Revenue: $402m beats (exp. $393m)

A note from Betterment 📣

We put your money to work

Betterment’s financial experts and automated investing technology are working behind the scenes to make your money hustle while you do whatever you want.

Learn more

S&P 500 Heatmap 🔥 

Recap Around the Street 🧠

The carry trade which has impacted the markets this week and what exactly is it?

We are in the midst of a massive unwind of global carry trades. A helpful and insightful book to read is ‘The Rise of Carry’. A carry trade is where traders borrow in a low yielding asset (making them short this asset) and then invest in a high yielding asset (making them long this asset). One of the most popular global carry trades is borrowing/short Japanese Yen and investing long in higher-return/risky assets. This carry trade works if the Yen stays stable or weakens, but if the Yen strengthens, traders have to cover their short Yen positioning by selling their long assets, which include Japanese and U.S. equities. One of the key assertions of The Rise of Carry is that this carry trade, which originally was contained to currency markets, has now engulfed highly liquid U.S. equity markets. They posit that this continued long demand for U.S. equities in this carry trade has artificially suppressed volatility, creating the environment for surprise spikes in volatility. Talk about a Minsky Moment (periods of low volatility fostering complacency and setting up for periods of high volatility). (Contributed by Cameron Dawson, CIO at NewEdge Wealth).

Airbnb earnings snapshot (contributed by Brad Freeman @Stockmarketnerd):

We continue to have the view that risks are skewed to the downside for 2024 GDP estimates given the recent string of weaker economic data and fading tailwinds for growth. Typically, estimate revision cycles lower are accompanied by risk off moves in markets, as investors reduce risk in the face of growth uncertainty. This often translates to lower valuations and lower earnings estimates. (Contributed by Cameron Dawson, CIO at NewEdge Wealth).

Market Preview 🎞️ 

• Wednesday, August 6th: MBA mortgage applications; Consumer credit report

• Wednesday earnings: Shopify (SHOP), Robinhood (HOOD), Walt Disney (DIS), HubSpot (HUBS) and CVS Health (CVS)

• Thursday, August 7th: Weekly jobless claims; Natural gas inventories

• Thursday earnings: The Trade Desk (TTD), Unity (U), and Datadog (DDOG)

Enjoy reading?👇

That’s all for today, folks! We’ll be back around the same time Thursday with a curated list of important news, economic data and market highlights. 

🔔 Be the first to know. Ensure you never do more than one read if you:

• Move our emails (especially your subscriber introduction) to your primary inbox (Quick instructions).

• 👋 Say hi. Responding to our emails (if any) lets your email provider know to not block us from your main inbox.