It Girl Identity: Issue 21

It Girl Identity Newsletter

Grab your espresso, dive into this week’s market movers, learn the different types of stocks, and check out our curated recommendations from It Girl Identity!

What’s Moving Markets

This week, investors will closely watch major companies’ earnings reports, such as Apple, Amazon, Alphabet, Meta, and Exxon Mobil, and evaluate whether they met expectations. Upcoming releases of economic indicators such as initial jobless claims, U.S. unemployment rate, and PCE inflation will tell us more about the current effects of monetary policy and will bring us closer to the next FOMC meeting decision.

What’s Up

• Spirit Airlines (SAVE): Spirit had been struggling with financial pressures and exploring bankruptcy, but on Monday received an extension on refinancing debt that sent shares up 53%. Frontier later demonstrated interest in acquiring Spirit, which is likely to happen as a result of restructuring. Finally, Spirit then announced plans to cut jobs and sell planes for higher liquidity, and the stock ended up 90% for the week.

• Top S&P 500 Gainers: Tapestry +13.54%, Deckers Outdoor +10.57%, Digital Realty Trust +9.62%, Capital One Financial +5.23%, Tesla +3.34%.

What’s Down

• McDonald’s (MCD): McDonald’s announced an E. Coli outbreak stemming from sliced onions in their Quarter Pounders, one of their most popular menu items. As a result, they removed it from all restaurants in 4 states, and their stock lost 7.6% for the week.

• Capri (CPRI): Capri, a fashion giant, planned to be acquired by Tapestry in a $8.5 billion deal. However, a NY judge blocked the deal and sided with the FTC claiming this would reduce competition in the accessible handbag sector and raise prices. Capri dropped 49%, but both companies are expected to appeal.

• Top S&P 500 Losers: Mohawk Industries -13.82%, Universal Health Services -9.75%, Colgate-Palmolive -4.14%, T-Mobile US -3.08%, McDonald’s -2.97%, Alexandria Real Estate Equities -2.86%.

Markets & Economy

• Lithium Breakthrough: The US approved a new lithium mine in Nevada as a strategy to break China’s dominance over supply chains of these minerals, along with $700 million in loans to help build the project. With less dependence on China for lithium, car manufacturers now have easier access to crucial lithium batteries, which could drive higher growth in the now stagnant EV market.

• Keurig Dr Pepper to Acquire GHOST: Keurig, a manufacturer and distributor of coffee and ready-to-drink beverages, will acquire GHOST Beverages, an energy drink manufacturer, for $1.24 billion in cash. Keurig sees growth potential through GHOST’s differentiation and allows them to expand market share into the energy drink category. With the growing trend of health-conscious and wellness-focused consumers, people have been shifting away from coffee to different energy drink brands, and this deal offers a way for Keurig to offset slowing demand in their coffee systems sector.

• TSMC Innovations: Taiwan Semiconductor Manufacturing Co. announced early production yields at its first plant in Arizona that surpass its home factories by 4%. This sets a precedent for the US chip expansion project, and is a sign of long-term sustainability for TSMC, as it is able to cover the high costs of maintaining the chip plant. As the main chip partner for Nvidia and Apple, TSMC is in line to receive $6.6 billion in government grants and $5 billion in loans to build three facilities in Arizona.

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!

Tuesday, October 29

• Job Openings and Labor Turnover Survey (Sep): Forecast: 7.9 million (Previous: 8 million).

  • Definition: Measures the amount of new job openings.

• Consumer Confidence (Oct): Forecast: 99.2 million (Previous: 98.7).

• S&P Case-Shiller Home Price Index (20 cities) (Sep): (Previous: 5.9%).

  • Definition: Measures changes in residential home prices across 20 major U.S. metropolitan areas. Important for assessing the health of the housing market and consumer wealth.

Wednesday, October 30

• ADP Employment (Oct): Forecast: 113,000 (Previous: 143,000).

  • Definition: Tracks the level of U.S. nonfarm private employment.

• GDP (Q3): Forecast: 3.2% (Previous: 3.0%).

  • Definition: Measures the quarterly percent change in GDP.

• Pending Home Sales (Sep): Forecast: -0.2% (Previous: 0.6%).

• Advanced U.S. Trade Balance in Goods (Sep): (Previous: -$94.2 billion).

• Advanced Retail Inventories (Sep): (Previous: 0.5%).

• Advanced Wholesale Inventories (Sep): (Previous: 0.1%).

Thursday, October 31

• Initial Jobless Claims (Oct 26): Forecast: 235,000 (Previous: 227,000).

  • Definition: Measures the number of new claims for unemployment benefits, indicating job market health.

• Personal Income (Oct): Forecast: 0.4% (Previous: 0.2%).

  • Definition: Measures the total income received by individuals before taxes. An increase can signal higher consumer spending power.

• Personal Spending (Oct): Forecast: 0.4% (Previous: 0.2%).

  • Definition: Measures the total amount spent by consumers. Higher spending indicates stronger economic activity.

• U.S. Employment Cost Index (Q3): Forecast: 1.0% (Previous: 0.9%).

• PCE Index (Oct): Reflects changes in prices of goods and services consumed by individuals. A lower rate indicates weaker inflation pressures. Forecast: 0.2% (Previous: 0.1%).

  • PCE (Y0Y): Annual change in the PCE index, reflecting inflation trends over the year. Forecast: 2.1% (Previous: 2.2%).

  • Core PCE Index (Oct): Measures price changes excluding food and energy, which can be volatile. Provides a clearer view of inflation trends. Forecast: 0.3% (Previous: 0.1%).

  • Core PCE (Y0Y): Annual change in the core PCE index, focusing on long-term inflation trends. Forecast: 2.6% (Previous: 2.7%).

Friday, November 1

• U.S. Employment Report (Oct): Forecast: 110,000 (Previous: 254,000).

• U.S. Unemployment Rate (Oct): Forecast: 4.1% (Previous: 4.1%).

• U.S. Hourly Wages (Oct): Forecast: 0.3% (Previous: 0.4%).

• Hourly Wages YoY: Forecast: 4.0% (Previous: 4.0%).

• S&P Final U.S. Manufacturing PMI (Oct): (Previous: 47.8%).

• Construction Spending (Sep): Forecast: 0.0% (Previous: -0.1%).

• ISM Manufacturing (Oct): Forecast: 47.6% (Previous: 47.2%).

• Auto Sales (Oct): (Previous: 15.8 million).

  Sources: Nasdaq, Markets Insider, WSJ, Market Watch

Types of Stocks

Here is what you need to know about the different types of stocks and which ones to invest in depending on your financial goals and risk appetite!

Blue Chip: Shares in large, well-established, and financially stable companies with a history of reliable performance. These companies typically have a market capitalization in the billions, offer consistent dividends, and often lead in their industry. They are considered lower risk and suitable for conservative investors focused on steady, long-term growth.

• Examples: Apple, Coca-Cola, Microsoft, American Express

Defensive Stocks: Shares in companies that tend to remain stable or perform well during economic downturns, providing steady returns even when the broader market is volatile. These companies are often in sectors with essential goods or services, like healthcare, utilities, and consumer staples.

• Examples: Procter and Gamble, Johnson & Johnson

Cyclical Stocks: Shares in companies whose performance closely follows the business cycle, meaning they tend to do well during economic expansions and suffer during recessions. These stocks are typically in industries that are sensitive to economic changes, such as automotive, luxury goods, travel, and construction.

• Examples: Ford, Delta Airlines, Marriott

Penny Stocks: Shares of small companies that typically trade at low prices, often under $5 per share, and have low market capitalization. These stocks are usually found outside major exchanges (like the NYSE or NASDAQ) and are traded over-the-counter (OTC) on platforms like the OTC Bulletin Board. Penny stocks tend to be highly speculative, with extreme price volatility, and they are considered high-risk investments.

• Examples: BuzzFeed

IPO Stocks: Shares of a company that are offered to the public for the first time through an Initial Public Offering (IPO). IPO stocks can generate significant interest as they offer investors a chance to buy shares at the company's entry point on the stock market. They can be volatile and uncertain as they lack historical data.

Commodity Stocks: Shares of companies involved in the production, extraction, or distribution of natural resources or raw materials, known as commodities. The performance of these stocks often correlates with the fluctuating prices of the underlying commodity due to supply, demand, and geopolitical factors.

• Examples: Exxon Mobil (energy), Mosaic Company (agriculture), Rio Tinto (mining)

Sources: Mark Wlosinski (Mark Talks Money), Forbes

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...

Keana Nadeshiko Rice Mask: This Japanese rice face mask leaves your skin soft and dewy, while nourishing and moisturizing dry skin. A must-try!

Finance Books

Hey It Girls! Dive into these must-read finance books that will elevate your money game and empower your financial journey. Whether you're just starting out or looking to refine your strategy, these books offer insights and practical wisdom to guide you.

1. The Millionaire Next Door: The Surprising Secrets of America's Wealthy, Thomas J. Stanley: This book will teach you how to prioritize savings and investments over ostentation.

2. The Science of Getting Rich, Wallace D. Wattles: The Science of Getting Rich emphasizes the importance of thinking positively and taking action towards wealth creation, asserting that anyone can achieve financial success through the right mindset and strategies.

3. Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence, Joseph R. Dominguez and Vicki Robin: This book provides a framework for transforming your relationship with money, focusing on financial independence and aligning spending with personal values.

4. The Intelligent Investor, Benjamin Graham: Graham advocates for a disciplined approach to investing, stressing the importance of long-term strategies and understanding market fundamentals to achieve financial security.

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See you next Monday, It Girls!

With Love,

It Girl Identity