It Girl Identity: Issue 12

It Girl Identity Newsletter

Grab your pumpkin spice latte (you know we had to) and read what's moving markets this week, how to start a side hustle, and enjoy our curated It Girl Identity recommendations!

What’s Moving Markets

The Dow, S&P 500, and Nasdaq finished last Friday on a high note, with notable gains across the board. Meanwhile, gold prices surged, oil dipped, and all eyes are on the Fed's anticipated rate cut in September, which could significantly influence market dynamics. Don't miss the shifts in the EV market and the latest updates on mergers, acquisitions, and global economic indicators.

What’s Up

• Builders FirstSource (BLDR): Expanding through acquisitions and share buybacks, having repurchased 45% of its shares in the past few years. The company’s board recently authorized a new $1 billion buyback program.

• FTAI Aviation (FTAI): Specializing in jet-engine leasing and repair, has seen its stock soar over 800% in the past five years. This surge comes amid significant challenges in the aviation industry, including supply chain issues and engine durability problems.

• Gold Prices Surge: Gold has risen 20% this year, surpassing $2,500 per ounce, driven by expected Fed rate cuts, high demand from technology, and purchases by China and India. Analysts foresee prices reaching $2,600 by year-end, though recent outflows from gold ETFs suggest central banks are leading the price increase more than retail investors.

• Top S&P 500 Gainers: Starbucks (SBUX) +26%, Super Micro Computer (SMCI) +24%, NVIDIA (NVDA) +19%, Ulta Beauty (ULTA) +17%, Micron Technology (MU) +16%.

What’s Down  

• Intuit (INTU): Dropped 6.83% after a gloomy forecast despite beating earnings.

• Bill Holdings (BILL): Fell 6.68% after Goldman Sachs downgraded the stock from Buy to Neutral.

• Las Vegas Sands (LVS): Slipped 1.17% following a downgrade from UBS.

• Top S&P 500 Losers: Chipotle Mexican Grill (CMG) -6%, The Hershey Company (HSY) -4%, Charter Communications (CHTR) -3%, Albemarle (ALB) -3%, Baxter International (BAX) -3%.

Markets and Economy

• U.S. Fed Rate Cut Expected: Jerome Powell, the Federal Reserve Chair, indicated that the central bank is likely to lower interest rates in September. Speaking at the Kansas City Fed’s annual conference in Jackson Hole, Wyoming, Powell stated that it’s time for policy adjustments, signaling a potential shift in monetary policy.

  • What It Means: Lowering interest rates usually makes borrowing cheaper and can stimulate economic growth by encouraging spending and investment. It can also help boost financial markets and make loans more affordable for consumers and businesses.

    Why It’s Important: A potential rate cut is significant because it reflects the Fed’s response to current economic conditions. It suggests that the central bank is aiming to support the economy by making credit more accessible. For investors, businesses, and consumers, this could lead to increased economic activity and affect investment strategies, borrowing costs, and financial markets.

• Chinese Bonds Rally: Yields on 10-year Chinese government bonds dropped to 2.18% from 2.6% a year ago, despite stock and housing market struggles. Authorities are trying to curb the bond rally to prevent potential banking losses, drawing parallels to the Silicon Valley Bank collapse last year.

  • China Urges Caution Amid Bond Market Frenzy: Despite falling yields on Chinese government bonds, the government is concerned about potential financial instability if prices keep rising rapidly. The risk of significant bank losses, similar to those seen with Silicon Valley Bank's struggles, and signs of speculative trading are prompting the government to take steps to stabilize the market.

• EV Market Shift: Chinese consumers are increasingly choosing domestic electric vehicles over traditional brands like GM and Volkswagen. This shift is altering global automotive market dynamics and pushing international brands to adapt to new consumer preferences.

  • Ford’s EV Pullback: Unlike the trend in China, Ford’s decision to cancel a planned electric vehicle (EV) model highlights a broader retreat within the EV industry. This move underscores challenges such as high production costs, technology issues, and fluctuating market demand. It may influence future investments and strategies in the EV sector by exposing financial and strategic risks associated with electric vehicle development.

• Taylor Swift’s Ticket Market: The resale market for Taylor Swift tickets is struggling because people tend to overvalue things they own and are afraid to sell if they think they'll lose money. This problem isn't just about tickets—it's a common issue in many markets where people misjudge value and trading opportunities. This explores a common behavioral issue in the stock market, where investors might hold onto losing stocks longer than they should or overpriced assets simply because they own them, affecting market efficiency and decision-making.

• AstraZeneca Increases Revenue Target: AstraZeneca sets an ambitious $80 billion revenue goal for 2030, leveraging its successful track record in cancer treatment and strategic growth. While it’s less known for obesity treatments compared to rivals like Eli Lilly and Novo Nordisk, AstraZeneca's potential in this field could boost its market position and investor value.

• Charles Schwab’s Glow Up: Charles Schwab is working to revamp its banking operations after rising interest rates led customers to move their cash for better returns. The company plans to shift its focus from relying heavily on customer deposits to generating more revenue from services like loans and financial advice. This transformation is crucial since about half of Schwab's revenue comes from its banking division, which has been key in reducing trading fees and eliminating commissions on online stock trades.

IPOs & Mergers and Acquisitions

• Uber Technologies Inc x General Motors Co. (GM) Partnership: Uber and Cruise are launching a multi-year partnership for driverless rides starting next year. This deal aims to boost Cruise's robotaxi business following a serious incident in October 2023 involving a pedestrian and subsequent company changes.

• M&A Activity Shows Signs of Revival: Mergers and acquisitions are bouncing back after a slow 2023. The Justice Department recently approved Alaska Airlines' acquisition of Hawaiian Airlines, and Mars is acquiring Kellonova. AMD is set to buy ZT Systems, and Kroger is challenging the FTC to complete its merger with Albertsons. The rise in deals is attributed to a buildup of private capital and a stagnant IPO market. Despite this surge, regulatory scrutiny remains high, with ongoing antitrust actions likely to affect future mergers.

Earnings Calendar

This Week's Major U.S. Economic Reports & Fed Speakers

Here is a quick breakdown of this week’s Fed Speaker events and economic indicators, what they mean, and their forecasts!

Monday, August 26

• Durable-goods orders (July): Measures new orders placed with manufacturers for durable goods, items meant to last three years or more. A decrease indicates weaker demand.

• Durable-goods minus transportation (July): Focuses on durable goods orders excluding transportation equipment, which can be volatile. Provides insight into underlying trends in manufacturing. 

Tuesday, August 27

• S&P Case-Shiller home price index (20 cities) (June): Tracks changes in home prices in 20 major U.S. cities. A higher index indicates rising property values.

• Consumer confidence (August): Measures how optimistic consumers are about the economy. Higher confidence suggests stronger consumer spending and economic growth.

Wednesday, August 28

Speakers:

• Atlanta Fed President Raphael Bostic: Provides insights into future Fed policy and economic outlook.

Thursday, August 29

• Initial jobless claims (August 24): Number of new claims for unemployment benefits. A rising number suggests weakening labor market conditions.

• Advanced U.S. trade balance in goods (July): Shows the difference between the value of goods exported and imported. A larger deficit could signal trade imbalances.

• Advanced retail inventories (July): Measures the level of unsold goods held by retailers. High inventories might indicate lower consumer demand.

• Advanced wholesale inventories (July): Measures unsold goods at the wholesale level. Helps gauge supply chain and demand trends.

• GDP (Q2): Measures the total economic output of the country. Revised figures can indicate changes in economic growth expectations.

• Pending home sales (July): Tracks contracts signed for the purchase of existing homes. Higher numbers suggest a robust housing market.

Friday, August 30 

• Personal income (nominal) (July): Measures the total income received by individuals before taxes. An increase can signal higher consumer spending power.

• Personal spending (nominal) (July): Measures the total amount spent by consumers. Higher spending indicates stronger economic activity.

• PCE index (July): Reflects changes in prices of goods and services consumed by individuals. A lower rate indicates weaker inflation pressures.

• PCE (year-over-year): Annual change in the PCE index, reflecting inflation trends over the year.

• Core PCE index (July): Measures price changes excluding food and energy, which can be volatile. Provides a clearer view of inflation trends.

• Core PCE (year-over-year): Annual change in the core PCE index, focusing on long-term inflation trends.

• Chicago Business Barometer (PMI) (August): Measures business activity and economic health in the Chicago area. Higher values indicate growth.

• Consumer sentiment (final) (August): Reflects overall consumer attitudes toward the economy. Higher sentiment can lead to increased consumer spending.

Sources: Business Insider, WSJ, Reuters, The Guardian, MarketWatch, Nasdaq

Side Hustle Secrets

Last week, we explored ways to trick yourself into saving more! This week we’ll cover easy, quick ways to boost your income to accelerate your savings.

Why Consider a Side Hustle? Many people are turning to side hustles to supplement their savings and fast-track savings goals, or especially us wanting to break that “broke college student” stereotype. Outside of extra income, side hustles can also offer new skill development and help test potential new career paths. The world is your oyster!

Popular Side Hustle Ideas

• Freelancing: Offer professional skills like writing, design, programming, or videography on online platforms or to local businesses.

• Tutoring: Either online through websites like Chegg or in-person, helping other students is a great way to build a consistent income stream with a returning client base.

• Reselling: Online reselling often includes clothes, shoes, cameras, and other trends that are highly sought after, and even dropshipping or flipping.

• Crafting: Turn your hobby into a business, whether it’s sewing, painting, jewelry-making, or print-on clothes. You can sell on Etsy or Depop or set up a booth at a local farmer’s market.

Maximize Your Earnings: No one would turn away another income stream, but it is important to set clear goals with what you want to achieve with your extra money. Treat them as you would a regular salary by maintaining your budgeting and savings tactics, and keep records to measure progress. This income is also taxable, so remember to allocate a portion of your income for taxes. You can also consider reinvesting in your side hustle to grow it into a consistent side business!

Take a Step Towards Financial Freedom: Choosing the right opportunity, managing your time effectively, and creating a clear plan for extra earnings will all lead to significant progress towards your financial goals. Whether you are saving for a big purchase, building an emergency fund, or simply investing in the future, a side hustle will help you get there faster.

Disclaimer: Information shared here is for educational purposes only. Consult a financial advisor for personalized advice.

It Girl Recommendations

Shop Our Other Recommendations Here: health, fashion, fitness, education, beauty, and skincare...

Pumpkin Spice Latte Recipe

Babble & Goose: With school back in session, get ready with cute, comfy, and IT GIRL-approved outfits. Babble & Goose offers adorable sweatpants and stylish tops that have you covered.

Check our more unique and comfy looks here: https://babbleandgoose.com/

Financial Fashion

As fall approaches, it's time to refresh your wardrobe with stylish options for both office and beyond from RIHOAS!

• Use our discount code (IGI20) for 20% off your order:

• Top Left -  The Red V Neck Polka Dot Flounce Mini Dress

• Top Right -  The Blue Lapel Double Breasted Pockets Coat

• Bottom Left -  The Navy Boat Neck Ruched Midi Dress

• Bottom Right -  Women's Blue Striped Long Sleeve Shirt

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See you next Monday, It Girls!

With Love,

It Girl Identity