vestact posted: " Market Scorecard US markets rose again yesterday, with the S&P500 logging its sixth consecutive session of gains, and minting yet another all-time high. That's six out six, similar to a perfect over in a cricket match. Markets have been edg"
US markets rose again yesterday, with the S&P500 logging its sixth consecutive session of gains, and minting yet another all-time high. That's six out six, similar to a perfect over in a cricket match.
Markets have been edging higher and the US economy is growing, which paints a bright picture for the forthcoming second-quarter earnings. Fears that the Fed will be forced to curb higher inflation have abated somewhat, so riskier assets seem more attractive.
In company news, Krispy Kreme had a solid debut on the Nasdaq and its shares popped another 23.53% yesterday. Elsewhere, Microsoft's Xbox cloud gaming is now available on Apple devices and Windows 10.
In summary, the JSE All-share closed up 0.46%, the S&P 500 closed up 0.52%, and the Nasdaq closed up 0.13%.
Our 10c Worth
One Thing, From Paul
The idea for this post came from an interaction between Marc Andreessen, a VC and tech pioneer, and Noah Smith, an academic and blogger. Read it all here.
One of the themes that emerges from their talk is that the true productive potential of the internet is only getting started, and that the pandemic will end up having pushed us to develop more distributed systems of production.
Andreessen (pictured below with his odd-shaped head) says this: "It's hard to overstate the positive shock that remote work works. Remote work isn't perfect, there are problems, but virtually every CEO I've talked to over the last year marvels at how well it works. And remote work worked under the extreme duress of a pandemic, with all of the human impact of lockdowns and children unable to go to school and people being unable to see their friends and extended families. It will work even better out of Covid."
"Companies of all shapes, sizes, and descriptions are retooling their assumptions on geographic footprint, where jobs are located, where employees are located, how offices are configured, and if there should be offices at all."
"It's possible that we'll see a huge surge in productivity growth over the next 5 years. This productivity growth is, in my view, the key to a strong "roaring 20's" thesis, that we are going to see an amazing economic boom in the US over the next several years, even on top of the incredible boom of 2009-2020."
That sounds good to me. Note that the companies that enable this revolution still have big upside potential. Those include Google, Apple, Microsoft and more.
Byron's Beats
The story of Steve Ballmer fascinates me. He was hired by Bill Gates in 1980 as the 30th employee of Microsoft. During that time he became very close with Gates and climbed the ladder to be CEO in 2000 until 2014.
During those 14 years as CEO, Microsoft had a relatively poor patch. They had many product failures while the core business ticked along slowly. Despite the poor performance, Ballmer amassed a 4% stake in Microsoft through share incentive schemes.
The company has thrived since Satya Nadella took over and so has the share price. Ballmer kept his shares and is now worth over $100 billion. Just incredible.
Bright's Banter
Investing app Robinhood finally disclosed its S-1 showing that it will list under the share code "HOOD" on the Nasdaq. The most interesting detail is that the company will set aside 35% of its shares for individual investors who use their platform. If this isn't democratising investing, then I don't know what is.
Recap: Robinhood was founded in Palo Alto, California, in 2014 by two former Stanford roommates, Baiju Bhatt and Vlad Tenev. Their thesis was that high trading fees are a barrier to entry for young investors, so by eliminating them Robinhood could democratise investing. Thank you GameStop and AMC!
According to the updated numbers, The number of Robinhood users has grown from half a million in 2014 up to 18 million in 2021. This helped the company generate $985.8 million in revenues in 2020, up from $277.5 million a year before. First quarter revenues were even more impressive at $522.2 million, up four times year-on-year.
Not everyone loves Robinhood. They were just fined $70 million by Finra (the US Financial Industry Regulatory Authority) for halting trading and other failures in March 2020. They were also found to have allowed clients to trade financial instruments they didn't understand. This was the highest fine ever imposed by Finra on a brokerage firm.
Linkfest, Lap It Up
SpaceX successfully launched 88 small satellites into orbit before landing back safely on Earth. This ambitious rideshare mission was done in two-stages using the Falcon 9 rocket to hoist the satellites - SpaceX launches 88 satellites into orbit and nails rocket landing.
Latin America accounts for more than half of the world's lithium reserves. In Argentina, state energy firms are entering the lithium business, while Mexico is studying the possibility of nationalising lithium operators - Lithium Nationalism is taking root in region with most resources.
Signing Off
Asian markets are mixed this morning. Japanese and South Korean markets are in the green, but mainland Chinese and Hong Kong bourses are down. US futures are mixed as well. The Rand has weakened to around R14.48 to the Dollar.
ECB President Christine Lagarde speaks today and traders will be waiting for that US jobs report which is also due today. Have a lovely weekend!
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