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| This week's gainers and losers |
| Gainers: Coinbase (+36%): The cryptocurrency trading platform caught fire after a legal victory deemed historic in a closely watched lawsuit against Ripple Labs. A US judge ruled that the company did not violate federal securities law by marketing its token on open exchanges. The SEC had accused Ripple Labs and its executives of selling unregistered securities. Since the judge ruled that XRP "is not necessarily a security", some observers are calling it a Pyrrhic victory. But in the short term, the blockchain ecosystem is delighted with the victory over the SEC. Kingspan (+22%): The Irish group electrified the building materials sector at the start of the week by largely anticipating its results publication scheduled for mid-August. In an unexpected update, it indicated that its first-half performance would be higher than market expectations. Momentum in the US, France and Germany remained solid. Blackstone (+11%): The prospect of the Fed easing policy as a result of lower-than-expected inflation has benefited investment firms such as Blackstone, which are likely to access both cheaper money and higher asset valuations. Losers: Aritzia (-22%): Despite rising sales, results for the Canadian fashion retailer fell sharply. Management's cautious outlook also explains the share's sharp decline this week. TD Securities changed its rating on the stock from buy to neutral following the publication. Viasat (-17%): A major blow for the satellite operator, which revealed this week that ViaSat-3 Americas, the latest spacecraft sent into space by SpaceX on April 30, had a deployment problem. The satellite's performance is likely to be affected. The precise consequences are not yet known. Progressive Corporation (-13%): If ever there was a sector in the US that was less buoyant than others, it would undoubtedly be the insurance industry, whose performance tends to disappoint. A case in point is Progressive, whose second-quarter net premiums came in below expectations. |
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| Commodities |
| Energy: Oil prices are rallying after a rather complicated first half for black gold. The latest macroeconomic statistics confirm the resilience of the US economy and the easing of inflation, a favorable scenario for risky assets. Although the International Energy Agency has lowered its forecasts for global demand growth, it should reach a new record this year, at 102.1 million barrels per day (mbpd). This forecast is shared by OPEC, which expects demand to reach 102 mbpd in 2023. This is the third week in a row that oil has risen. European Brent crude has broken the USD 80 barrier and is trading at around USD 81 a barrel, while ithe US WTIvis trading at around USD 76.60. Metals: Like energy, base metals are also benefiting from a more conciliatory environment. Here, it is the weakening of the US dollar and the gradual fall in metal inventories that are supporting copper, aluminum and zinc prices. On the London Metal Exchange, most metals recorded a positive weekly sequence, despite the latest Chinese trade data, which remained rather mixed compared with economists' expectations. Last week, we mentioned the slowdown in copper supply in Chile. This week, it's Peru's turn to report on its monthly copper production, confirming the positive trend in its mining supply, which rose by 5.8% month-on-month. In precious metals, gold has broken out of its previous horizontal consolidation zone (between 1900 and 1930 USD) and is now trading at around USD 1955 an ounce. Agricultural products: Grain prices did not fluctuate much this week in Chicago. The US Department of Agriculture revised upwards its production estimates for corn. This may seem paradoxical, given that drought tends on the contrary to reduce US crop yields. That's why it's also important to take into account another parameter, that of corn acreage, which has risen sharply this season, offsetting the effects of the unfavorable weather. In terms of prices, corn prices have stabilized at around 510 cents a bushel, compared with 650 cents for wheat. |
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| Macroeconomics |
Atmosphere: I smell a pivot. If there were only one statistic to remember from the past week, it would be US inflation (CPI). At +4.8% vs. an expected 5% annualized rate (excluding food and energy), it eclipsed the Bank of Canada's rate hike of 25 basis points. No more inflationary fears! No more monetary tightening! So, yes, 92% of investors are still betting on a rate hike in July. However, only 12.9% believe that the Fed will raise rates again in September! Is it time for the long-awaited pivot? Producer prices (core PPI), at +2.4% versus +2.6% expected, reinforce this sentiment. While all bets are not yet off, a look at the price action on bonds is enough to show that all bets are off. At 5.08/11%, the yield on the 2-year US bond stumbled on its October highs, while the 10-year bond fell back below its March highs to 4.09%, dragging down the dollar and pushing up gold and indices. Much to the delight of investors everywhere. |
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| Things to read this week | ||||||
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*The weekly movements of indexes and stocks displayed on the dashboard are related to the period ranging from the open on Monday to the sending time of this newsletter on Friday. The weekly movements of commodities, precious metals and currencies displayed on the dashboard are related to a 7-day rolling period from Friday to Friday, until the sending time of this newsletter. These assets continue to quote on weekends. |
