NEWS
The Rest Of The Market Got Some Love

The DOW returned to 40k (the Emperor Protects) and then kept moving to hit new all-time highs. The S&P 500 also made new ATHs. And the Russell moved to levels not seen since mid-January 2022. However, all the indices gave up a good chunk of gains with strong selling into the close. Consequently, the NASDAQ was the only index to close in the red this week. Let’s see what you missed. 👀

Also, thank you for putting up with me (Jon Morgan, Litepaper author) this week! I now turn it back over to Tom! Have a great weekend everyone!

Today's issue covers JP Morgan, Citi, and Wells Fargo earnings, along with a possible future headwind about a NATO plan to seize China’s EU stuff, maybe. 📰

Here's today's heat map:

10 of 11 sectors closed green. Consumer discretionary (+0.96%) led, & communication services (-0.75%) lagged. 💚

June's Producer Price Index (PPI) rose 2.6% year-over-year, surpassing the 2.3% forecast, and marking the highest level since March 2023. The increase in final demand services prices was a key driver, while final demand goods saw a decline. Revised prior numbers and mixed signals leave the market uncertain about inflation trends. 📊

Fitch stated that the Federal Reserve needs to see similar CPI results in August and September before considering rate cuts. While some analysts predict a September cut, others argue the Fed might wait until November. The debate continues amid mixed economic signals and political considerations. 💵

Goldman Sachs warned of a potential "late summer equity market correction" if earnings disappoint and investors shift focus to autumn elections. Historical patterns and current market sentiment suggest downside risk after the best trading days of the year. Slow August flows, and full buyer positions add to the caution. 📉

The University of Michigan's July consumer sentiment fell to 66.0, below the expected 68.5 and down from 68.2 in June. Current conditions and expectations both declined, while 1-year and 5-year inflation expectations remained steady at 2.9%. The report indicates waning consumer confidence amidst economic uncertainties. 😟

The SEC concluded its three-year investigation into Hiro Systems, formerly Blockstack, which raised $70 million in token sales from 2017 to 2019, without recommending enforcement action. This follows the SEC's recent decision to drop an investigation into Paxos, marking another win for the crypto industry. 📝

Other active symbols: $MAXN (-1.37%), $TSLA (+3.64%), $NVDA (+3.15%), $DJT (+4.92%), $BTC (+0.94%), $LCID (+24.71%), and $QS (+17.56%). 🔥

Here are the closing prices: 

EARNINGS
JPMorgan Crushes Earnings, Stock Yawns 🥱

JPMorgan ($JPM) decided to show off this quarter thanks to a $7.9 billion net gain from Visa ($V) shares. Despite this, their stock dipped over 2% at the open. 📉 

• EPS: $4.40 vs. $4.14 expected

• Net Income: $18.1 billion, up 25%

• Revenue: $51 billion, up 20%

• Provision for Credit Losses: $3.1 billion

Jamie Dimon, the CEO, is both boasting and warning. The guy’s juggling solid performance and economic doom. Their CET1 ratio is a comfy 15.3%, and they’re planning a dividend hike for the second time this year.

Investment banking fees skyrocketed 50%, equities trading revenue is up 21% to $3 billion, and fixed-income trading is up 5% to $4.8 billion. Yet, they set aside $3.05 billion for credit losses. Cautious much, Jamie? 🤔

Dimon also pointed out that while the company is in a strong position, they’re keeping a wary eye on the economic landscape. The provision for credit losses includes a net reserve build of $821 million, indicating they’re bracing for potential trouble ahead.

But hey, at least they’re increasing the dividend. 🚀

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