Monthly Market Debrief

The Olympics are underway, which means you’ll catch me on the couch tallying all the medals Florida Gators are collecting. I’m claiming Katie Ledecky as a Gator since she came to her senses and trains at UF now. Sorry, Stanford.

Market Snapshot

After spending a lot of July in the red, the markets surged on the last day of the month to finish in the green, returning 1.13% for the month and 16.43% YTD. Not bad.

The mid-month slump was largely caused by a massive tech sell-off. Between July 10th and July 28th, the collective stock value of Big Tech giants Nvidia, Apple, Microsoft, Alphabet, Amazon, Meta, and Tesla dropped 12%.

This is a particularly big week for the market with a Federal Reserve meeting, the July jobs report, and earnings reports from Big Tech giants Apple (announcing today), Amazon (announcing today), Microsoft (report was meh), and Meta (report was decent), all colliding at once.

Not to mention earnings reports from 167ish other members of the S&P 500 that all happened/are happening this week, including everyone’s favorite aircraft manufacturer, Boeing (BA).

The outcomes from the combination of these events will inevitably drive the direction of the market into the first week of August, which better be a good month in honor of my birthday.

Although the Fed didn’t announce an interest rate cut at yesterday’s meeting, Fed Chair Jerome Powell said that a September rate cut "could be on the table." The markets surged as a result and have already priced in a quarter-point interest rate cut in anticipation of September’s meeting.

Dollar Debrief’s internal Fed whisperer (Wilson) is predicting that the Fed will leave the door open to a rate cut later this year but not yet, the proverbial carrot on a stick. As always, I’m with Wilson.

In other news, I’m sure you probably haven’t heard yet that President Biden officially ended his 2024 presidential campaign. So that’s a fun twist to an already interesting election season.

Oh, and there was also an assassination attempt on former President Trump at a rally, which thankfully failed.

Just when I thought something funny couldn’t come from a Presidential assassination attempt, the moral support ear bandages sported by Trump supporters at the RNC had me dying.

Company Highlight - 3M

I’m tired of hearing about Nvidia, Amazon, and Elon Musk’s shenanigans of the day. Let’s talk about 3M.

3M makes a lot of stuff that you probably didn’t know they made, like Post-it Notes, Scotch Tape, Command Hooks, Bondo, faulty earplugs, and various other products.

3M has a lot of patents to support these products, 131,651 to be exact. In 2022, they were awarded 2,600. That is an average of over 7 per day including weekends and holidays! 

All that to say, they don’t get the benefit of the Big Tech stock price bump like any other publicly traded company that is somewhat tech related.

Under former CEO Mike Roman, 3M saw more than $60 billion in market value wiped out as it struggled through “stagnant sales, massive legal liabilities, and soaring raw material costs.”

Despite my best efforts to do my part to support 3M by buying sticky notes for work and Command Hooks for the house, I couldn’t quite push 3M over the edge.

But 3M’s trajectory changed drastically in the past week.

Enter new 3M CEO Bill Brown, the man who’s making Post-it Notes cool again.

Brown, the former chairman of L3Harris Technologies, took the helm of 3M as CEO on May 1st.

Brown used his first earnings report last week to publicly call out the company’s issues and outline his priorities for the company. He emphasized increasing their new product development efforts to revitalize an “aging” portfolio and encouraged 3M employees to “challenge the way [they’ve] done things in the past.” Brown also aims to attack waste and streamline distribution to further cut costs for the company.

His message, with tangible financial progress to boot, resonated with shareholders in a BIG way.

As a result of the concoction of Brown’s message, earnings that exceeded Wall Street expectations, and me buying ANOTHER pack of Command Hooks for the new house, 3M recorded its biggest stock gain in more than 40 years, soaring 23% last Friday alone.

Will the rally continue? Who knows, but I do know that I’ll continue to do my part to support.

🫡

Fun fact: apparently Command adhesive strips pass through five factories and two distribution centers before reaching a customer. I’m no supply chain expert but that seems a bit excessive.

Current Event - Venezuela Presidential Election Conflict

It turns out that the US isn’t the only country that has election drama, but I think Venezuela has us beat (hopefully).

If you aren’t familiar with President Maduro or the state of Venezuela, he hasn't quite been crushing it as Venezuela’s leader since he took over in 2013.

Venezuela’s presidential election wrapped up on Monday, where current President Nicolas Maduro was declared the winner of a third Presidential term by the National Electoral Council, which is loyal to Maduro’s party.

The NEC (not sure if that’s what they go by but that’s what I’m calling them) announced that Maduro secured 51% of the vote, compared to opposition candidate Edmundo González who allegedly received only 44%.

This outcome is… suspicious, putting it lightly. Exit polls and voting tallies both indicated a decisive win for González.

World leaders are mostly reluctant to accept the outcome, with US Secretary of State Anthony Blinken more or less saying the results are a sham. China and Russia both congratulated Maduro, if that tells you anything.

Protests and rallies have broken out throughout Venezuela in response, with protestors and police clashing since the results were announced. Opposition party national coordinator Freddy Superlano was detained by "armed men clad in black," which is probably just a big misunderstanding, of course. 

Opposition leader Maria Corina Machado called for marches on Tuesday to demonstrate “the determination [they] have to make every vote count and defend the truth.”

Maduro’s regime has vowed to maintain the peace and prevent the attempt being made to “impose a coupd’état in Venezuela” (Maduro’s words).

Only time will tell what the near future holds for this election. If you want to learn more, read here, here, and here… but not here. 

What We’re Reading/Watching/Listening To

The Olympics, duh.

I’m particularly jazzed about rock climbing, swimming, and wrestling this time around.

Debrief on Deck

Next week, Wilson is going to talk about that pesky number we’re all assigned by the man that determines how much it costs to buy a car or house… credit scores.