News Recap • Week 35 2024

US GDP growth beats while inflation continued to cool

The US economy grew at an annualized pace of 3%, up from the previous estimate of 2.8%. At the same time, most inflation numbers were revised lower. Both headline and core PCE were lowered by 0.1%, to 2.5% and 2.8% respectively.

US PCE came out Friday morning. Analysts expected a 0.2% monthly increase in both headline and core prices, and respective gains of 2.5% and 2.7% annualized. All numbers came in line, except the latter which was slightly cooler than expected at 2.6%.

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NVIDIA drops despite beat-and-raise

Nvidia reported earnings after market hours on Wednesday. They beat expectations and raised guidance for the current quarter, but fell short on their sales forecast. They also failed to hit the very elevated whisper numbers on the street. Shares slid 6% on Thursday.

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In other news

• Eurozone inflation fell to 2.2%, in line with expectations.
• Berkshire Hathaway became the first non-tech US company to reach a $1 trillion valuation.
• German inflation dropped to 2% in August, significantly lower than the 2.3% expected.
• Super Micro Computer delayed its earnings report, sending the stock down by 20% on Wednesday.
• Spain posted a 2.4% inflation rate for August, lower than economists’ 2.5% expectation and well down from July’s 2.9% reading.
• Earnings kept coming in, primarily from tech and retailers:
  • Temu owner, PDD Holdings, plummeted 29% on Monday after reporting a surprisingly pessimistic outlook.
  • Salesforce jumped after a revenue beat and raise.
  • CrowdStrike calmed some concerns after the recent crash with shares jumping 5% on Thursday.
  • Best Buy surged 16% on Thursday after a big earnings beat and raise.
  • Affirm surged 32% Thursday on a big earnings beat for their best day in three years.
  • Ulta Beauty dropped 7% after hours on Thursday after a 1.2% YoY sales declinevs expectations for 1.2% growth.
  • Lululemon cut full-year guidance as it missed sales expectations for the first time in two years. It did beat on EPS though and also kept earnings guidance in line with previous expectations. Shares jumped more than 4% in after-hours Thursday.
• Disney got permission from the Indian authorities to acquire the entertainment company, Reliance Industries, for $8.5 billion.
• Etsy sued Alphabet over monopolistic practices.
• OpenAI is pursuing a new funding round with both Apple and Nvidia as potential investors, valuing the company at more than $100 billion.