Category: Daily in Portfolio Management

Jan 31st, 2024 - On Wednesday, Wall Street experienced its most significant decline since September after Big Tech stocks reported earnings. The S&P 500 lost 1.6% . The Nasdaq Composite fell 2.2%, and the Dow fell 0.8%. FED held rates unchanged.The market was pricing rate cuts to start in March but chairman of FED Powell said that he thinks it would be too soon to start cutting in March, however he also expressed that inflation is heading towards their target and rate cuts will start at some point this year. One of our portfolio holdings, Novo Nordisk (NVO) (Purchased 1 unit @ $100.88) increased by more than 5% after posting a Q4 earnings report that topped estimates. (Earnings of 71 cents compared to 66 cents expected.) The company announced that…

Jan 30th, 2024 - On Tuesday, Advanced Micro Devices (AMD), one of the main chipmakers worldwide,  disclosed 2024 Q1 revenue expectations way lower than Wall Street analysts’ estimates, while the AI processors sales are expected to increase sharply. With respect to the second feature,  it must be considered that many businesses are trying to find alternatives rather than using AI  chips developed and sold by Nvidia. However, the AMD chips represent one of the few available solutions and probably the most appropriate one, providing an incredible competitive advantage to the company in this sector. So, focusing on the analytical data, AMD forecasted revenue is equal to $5.4 billion against the $5.73 billion expected by market operators, while the 2024 AI revenue expectation increased $1.5 billion from the previous value of…

Jan 29th, 2024 - In a surprising turn of events, Amazon has decided to abandon its planned acquisition of iRobot, a renowned vacuum-maker company, known for its Roomba devices; this move comes after both companies acknowledged that obtaining regulatory approval for the deal was an insurmountable challenge. Alongside this announcement, iRobot disclosed plans to lay off approximately 31% of its workforce, equating to around 350 employees, and simultaneously, Colin Angle, iRobot's Chair and CEO, has stepped down with immediate effect. Following this news, iRobot's stock experienced a 10% decline during morning trading. The uncertainty surrounding the fate of the deal intensified when The Wall Street Journal reported that the European Union was unlikely to grant regulatory approval. Indeed, in July, the European Commission initiated an investigation, expressing concerns that the…

Jan 28th, 2024 - Given the USA is currently entering the presidential race, it is wise for us to look at how a possible republican victory might affect the stock market, and especially, our portfolio. As it stands, Donald Trump seems to have the upper hand over Nikky Haley in the republican party, meaning we will probably see a repeat of the 2020 race, featuring Joe Biden and Donald Trump. Joe Biden has had a relatively firm stance on the export of Artificial Intelligence related technology to China, banning certain Nvidia products from being exported altogether. These bans haven’t significantly impacted Nvidia, as the Palo Alto based company has successfully managed to build replacements for every GPU that got banned. However, Trump would have a much more strict stance in…

Jan 27th, 2024 - JPMorgan Chase is undergoing significant leadership changes, stirring speculation about the eventual successor to current CEO, Jamie Dimon. The reshuffle involves key executives, including Jennifer Piepszak and Marianne Lake, who were previously considered front-runners for Dimon's position. Piepszak, former co-head of JPMorgan's consumer bank, now shares the role of co-head of the commercial and investment bank with Troy Rohrbaugh, an experienced leader in the bank's trading operations. Marianne Lake, Piepszak's former partner, transitions from co-head to become the sole CEO of the consumer bank, overseeing major operations in retail banking, credit cards, and small business lending. These strategic moves aim to provide Piepszak and Lake with more experience as they remain in the spotlight of the ongoing succession race. In 2021, when appointed co-heads of consumer…

Jan 26th, 2024 - On Friday, markets showed indecision, as the S&P 500 declined 0.07% to end the session at 4,890.97, ending its winning streak at six days. The Nasdaq declined 0.36% to 15,455.36 points, while the Dow Jones Industrial Average rose 0.16% to 38,109.43 points. Tech stocks faced declines on Friday, and Intel suffered a significant setback, with its stock falling by almost 12% after posting a weak guidance for the first-quarter that was below expectation. The company decided to be cautious for two main reasons: its challenge in catching up to Nvidia in the AI chip-maker market and also a weak PC market.  Visa's shares dipped 1.71% after the credit card giant reported a slight beat on Q1 earnings but failed to impress investors. Despite robust results (8%…

Jan 25th, 2024 - Portfolio holding Boeing (BA) (Purchased 0.15 units @ $248.79) fell 5.71% today, as the FAA announced a pause to the production of their 737 max 9 planes. However, on a positive note, the planes already produced are now allowed back in the air. This was a major blowback to our holding’s business model. Therefore, we are now reconsidering our stance on the future of the company within our portfolio altogether.  From a more macroeconomic perspective, an estimate of the USA’s economic growth in the last fiscal quarter of 2023 beat analyst expectations by 1.3%, as the economy grew by 3.3% compared to 2% expected by analysts. The market reacted mildly, with the Dow Jones falling by 60 basis points (0.6%) and the S&P 500 rising 50…

Jan 24th, 2024 - The Dow Jones fell 26 basis points today, whilst the NASDAQ and S&P 500 instead grew 0.36% and 0.08% respectively, as Nvidia and other large cap tech companies continue their meteoric rise. Portfolio holding IBM (IBM) (Purchased 0.1693 units @ $151.04) rose today, increasing more than 5% in the post market following the release of their fourth quarter earnings. The company netted $3.3 billion in income or $3.55 per share, with expectations being $2.9 billion in income and $2.96 per share. The firm’s executives cited a sharp increase in Artificial Intelligence demand as the backbone to this outstanding quarterly performance.  Furthermore, portfolio holding Nvidia (NVDA) (Purchased 0.2773 units @ $471.73) further rallied today, adding 2.49%. The company has performed phenomenally so far this year, and has…

Jan 23rd, 2024 - Today, Johnson & Johnson (JNJ) reached an important agreement to end an investigation conducted by more than 40 states. The investigation accused the New Jersey based company of false disclosures regarding the real dangers to one's health health deriving from the use of its talc-based products. By the way, this does not solve the high number of accusations from Johnson & Johnson consumers, according to which the talc-containing products were the main cause of cancer for them. Many of these civil lawsuits will go on trial during the course of 2024. So, it seems like the company just admitted its responsibilities in causing serious diseases to its customers because of its products. As a result, J&J stock price dropped by 1.64% at 16:00 EST.  As reported by a regulatory…

Jan 22nd, 2024 - The financial markets are on edge as they grapple with the potential structural implications of Donald Trump's proposed 10% tariff increase on all imported goods. Michael Every, a global strategist at Rabobank, asserts that this move has the power to "shake up every asset class." Trump, a leading contender for the 2024 Republican nomination, aims to triple the government's intake by imposing these tariffs, intending to boost American domestic production. Criticism of the policy is bipartisan, with Treasury Secretary Janet Yellen acknowledging that it would raise the cost of various goods for American businesses and consumers; the Tax Foundation estimates an annual tax increase exceeding $300 billion for U.S. consumers, potentially triggering retaliatory tax hikes by international trade partners. The American Action Forum predicts a 0.31%…