Market scorecard
US markets powered higher yesterday, on the back of a slew of strong corporate earnings reports. Meta Platforms deserves a special mention, rising by 14% after delivering surprisingly good numbers on Wednesday. The S&P 500 had its best day since the first week of the year.
As we often point out, these good trading days come along when they are least expected, and you have to be invested to benefit from them. In other words, "you have to be in it to win it".
In other company news, Intel shares advanced 5% in after-hours trading despite a staggering 133% reduction in earnings. Elsewhere, Amazon first rose 12% then declined 2% post-market after comments made in its earnings call muddied its cloud outlook, notwithstanding a solid revenue beat. Finally, dental supplier Align Technologies was the worst-performing big-cap stock, sinking by 10%.
On Wednesday, the JSE All-share closed up 0.30%, and on Thursday the S&P 500 rose 1.96%, and the Nasdaq shot 2.43% higher.
Our 10c worth
One thing, from Paul
It's Friday, so here's some more unsolicited life advice. I enjoy digging up these ideas and sharing them with you every week.
We should all ask ourselves this question more often: What's my job, and am I doing it properly?. Here in South Africa, there are a lot of people not doing their jobs, which is why we have so many challenges as a society.
American professional football coach Bill Belichick of the New England Patriots has eight Super Bowl wins. One of his mantras is simply "Do your job." He made his way up the ranks of the NFL by working long hours and being intensely focused.
Sharpen up, make a task list, and do the hard yards. That's how you'll get ahead.
Bright's banter
Netflix plans to invest $2.5 billion in South Korea over the next four years. They want more Korean TV shows, movies, and unscripted content, and are committing double the amount they have invested there since 2016.
The announcement was made after a meeting between South Korean President Yoon Suk Yeol and Netflix co-CEO Ted Sarandos. Yoon praised the investment as a "major opportunity" for South Korea's content industry and Netflix. The Koreans will benefit from increased cultural exports and soft power.
South Korea's entertainment industry, known as the "Korean Wave" or Hallyu, has seen significant growth in recent years, with its music market led by K-pop groups like BTS and Blackpink.
In 2021, exports of content including music, video games, and films reached a record high of $12.4 billion, surpassing home appliances and rechargeable batteries in export volume. That's really impressive.
Shares of South Korean production and entertainment companies such as Showbox and Studio Dragon rallied on the news.
Netflix's decision to invest in South Korea was based on the company's confidence in the Korean creative industry, citing the success of global hits like Squid Game, The Glory, and Physical: 100.
Byron's beats
Tesla's numbers disappointed the market last week and the share price has taken a hit. It's gone from $180 to $160 a share in a matter of days. There's always a big market focus on quarterly trends in vehicle sales and demand. Elon Musk has made large price cuts in response to slightly softer demand, but as Michael mentioned a few days ago, they are also being done to bring prices to a level that attracts government EV credits.
Before you get too worried about this being a Tesla-specific issue, take a look at this graph from Charlie Bilello which shows you the interest rate on a 48-month car loan in the US. It is currently at 7.46% which is the highest since 2007. Tesla is not immune to the macro environment and this will certainly be having an impact on sales. We expect interest rates to fall in due course.
Linkfest, lap it up
Software didn't eat the world and AI won't either. These technologies are nothing without the human touch - AI won't cause mass unemployment.
Lego broke ground on its first US factory. The 13-building green plant is in Chester, Virginia - Inside the $1 billion US Lego facility.
Signing off
Asian markets are looking great this morning, taking their lead from robust tech earnings on Wall Street. Benchmarks advanced in Hong Kong, Japan, mainland China, and South Korea. Japan kept its key interest rate unchanged and announced a review of its policy, meaning an ultra-loose monetary agenda is here to stay.
Asian investors prepared for earnings reports from some of the largest Chinese lenders including Bank of China, China Citic Bank Corp, and Industrial & Commercial Bank of China.
US equity futures are taking a momentary breather this morning, down a modest 0.25%. It would be great if we could tack on another good day to end the week firmly in the green. The Rand is trading at around R18.33 against the US Dollar.
We hope that you are enjoying the long weekend. It's Workers day on Monday, so we'll be back in your mailbox on Tuesday morning.
Sent to you by Team Vestact.
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