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In today’s edition,
- Apple is adjusting its theatrical focus
- Tokyo Electron expands in India
- Stimulus boosts stocks in China
- Meta and AI-driven wearables
- Chip stocks surge
- Crypto meets payments
Market Snapshot
Stocks stretched their winning streak, boosted by solid economic data, cooling inflation, and the prospect of lower interest rates. Despite some shakiness in the tech sector, the S&P 500, Dow, and Nasdaq all closed the week higher, setting up a strong finish for September.
Looking ahead to October, there’s a bit of caution. Both August and September started with sell-offs due to soft economic data, and next week brings the same key reports—nonfarm payrolls and ISM Manufacturing PMI. With the U.S. election around the corner, we might also see some added volatility.
On the bright side, the latest inflation data was encouraging. The August Personal Consumption Expenditures (PCE) index rose just 0.1%, signaling inflation is easing. The annual PCE rate came in at 2.2%, close to the Federal Reserve’s 2% target. As the week closed, the S&P 500 was up 0.60% at 5,738.17, the Dow gained 0.59% to 42,313.00, and the Nasdaq led with a 0.69% rise to 18,119.59.
Stock market closing data for the week of Sep 23rd to Sep 27th, 2024
News Summaries
Apple is rethinking its film strategy after recent big-budget releases like Killers of the Flower Moon and Napoleon underperformed at the box office. Instead of sticking with wide theatrical releases, Apple is shifting toward streaming for most of its films. This isn’t about cutting costs but about making better use of its $1 billion annual film budget. The plan is to release about a dozen movies each year, most with budgets under $100 million. Only one or two major films, like F1—which has a production budget of over $300 million—will get a global theatrical release. Apple’s approach reflects broader changes in the industry. Netflix and Amazon are changing their movie strategies. They’re focusing more on streaming and less on theatre releases. The reason? Big-budget movies aren’t making enough in theatres. Streaming, however, allows better control over costs and audience engagement. Apple’s next theatrical move hinges on the performance of F1, a key test for its updated approach.
Tokyo Electron, Japan’s biggest chip equipment maker, is planning to build a team of engineers in India by 2026. Their first focus will be providing technical services to Tata Electronics. This fits into India’s larger strategy to boost semiconductor manufacturing, backed by government incentives and big investments from companies like Tata and Micron. Tokyo Electron sees a growing demand for chips, especially with the rise of AI, autonomous cars, and energy-efficient technologies. While U.S. pressure on Japan to limit chip exports to China may reduce sales there, overall demand for chipmaking equipment is expected to increase. Tokyo Electron plans to hire 10,000 people globally over the next five years. India is seen as a growth opportunity, not a replacement for the Chinese market. The company will also help train Tata’s workforce on chipmaking technology, as India continues to push for more local production.
Chinese stocks have surged 15.7% this week, the best performance since 2008, after Beijing launched a $114 billion stimulus package to support the economy. The People’s Bank of China created an Rmb800bn lending pool to help companies buy back shares and encourage investments in local equities. This boost is part of China’s efforts to stabilize its markets, deal with the property crisis, and hit its 5% growth target. The rally has boosted European markets, especially luxury brands, with hopes of increased Chinese spending. Meanwhile, prices for industrial metals like copper and zinc have risen, driven by China’s manufacturing needs. Analysts expect this momentum to continue. However, they question whether it will be enough to improve weak consumer sentiment.
At Meta’s annual Connect conference, CEO Mark Zuckerberg revealed a prototype for Orion, lightweight augmented reality glasses with holographic displays and AI capabilities. The glasses can overlay 2D and 3D content in the real world and offer proactive suggestions using AI. While the prototype is currently for internal use, Zuckerberg said the glasses need to be smaller, more fashionable, and affordable before they’re ready for consumers. Meta believes AR glasses could replace smartphones. This move aims to compete with Snap and sidestep Apple’s ecosystem. The glasses, named Orion, will include a brain-controlled interface for new interactions. Additionally, Meta updated its Ray-Ban smart glasses and the AI model, Llama. Zuckerberg claims Llama is now an industry standard. The goal? To create AI devices that integrate smoothly into daily tasks.
Global chip stocks surged after Micron forecasted better-than-expected revenue of $8.7 billion for its upcoming quarter, surpassing estimates of $8.28 billion. Micron shares jumped 15% on the news. In South Korea, Samsung saw its shares rise over 4%, and SK Hynix gained more than 9%. SK Hynix announced it had begun mass production of its new high-bandwidth memory (HBM) chips, which are key for AI processes. Both Micron and SK Hynix supply memory chips for Nvidia’s AI products, and Micron confirmed its HBM chips are sold out for 2024 and 2025. The positive sentiment around chip demand extended to Japan, where Tokyo Electron’s shares rose 8%, and Europe, where ASML and STMicro also saw gains of over 4%. Investors remain optimistic about the strong demand for AI-related chips driving the market forward.
From the World of Crypto
Mastercard has just made spending Bitcoin and other cryptocurrencies a whole lot easier.
They’ve launched a euro-denominated debit card that lets users spend directly from their non-custodial wallets. Developed with partners like Mercuryo, this card allows you to shop at over 100 million merchants worldwide—no need to convert your crypto into regular money first.
You keep full control of your digital assets while using them like any other currency.
One of the biggest challenges for crypto users has been transferring funds to centralized exchanges just to make a purchase. Mastercard’s new card takes that hassle away.
You can spend your Bitcoin and other cryptocurrencies directly, and it automatically converts your crypto to fiat at checkout. Plus, it supports multiple cryptocurrencies, integrates with Apple Pay and Google Pay, and makes the process smooth and familiar.
Yes, there are some fees. They are: €1.60 to issue, €1 monthly, and a 0.95% transaction fee. But, many will find the ease of use and global acceptance worthwhile. If you want to keep your crypto but still spend it like cash, this could be a great option.
This move isn’t just about convenience. It’s a step toward making crypto part of everyday life.
By making it easier to spend digital currencies, Mastercard is pushing for broader adoption. This could even lead to more competition, with banks likely feeling the pressure to offer similar services.
Mastercard’s card is helping build the future of payments. It aims for a seamless blend of crypto and traditional finance. This will lead to faster, cheaper transactions for all.
Good compilation