Weekly Market Update - 15 July 2024
All-Time Highs
US stocks closed at all-time highs for the 36th time this year after Federal Reserve Chair Jerome Powell’s remarks to Congress did little to alter bets that the central bank will be able to cut interest rates this year. Equities edged upward, defying concerns about an overstretched market. The S&P 500 rose for a sixth straight day — its longest winning streak since January. While Powell was careful not to offer a timeline for rate cuts, he emphasized mounting signs of a cooling job market after government data showed a third straight month of rising unemployment. Treasuries pared losses after a solid $58 billion sale of three-year notes, though a rout in European bonds kept a lid on the market. Swaps traders continued to project two rate cuts in 2024.
Source: Bloomberg
Acquisition On Pause
Google parent Alphabet has shelved efforts to acquire HubSpot, sources told Bloomberg, putting to bed the prospect of a takeover that would have ranked among the biggest of the year. Shares of HubSpot, a customer relationship management company, fell as much as 19%, the most since 2020, giving the company a market value of about $25 billion. Alphabet had communicated its interest in a potential deal earlier this year, but did not reach a point of detailed discussions around due diligence. A deal would have put it in the same league as the pending $34 billion acquisition of Ansys by Synopsys. Buying HubSpot also would have helped Alphabet compete with other players like Microsoft, Oracle and Salesforce.
Source: Bloomberg
Robotaxis Delayed
Tesla is postponing its planned robotaxi unveiling to October to allow teams working on the project more time to build additional prototypes, sources told Bloomberg. CEO Elon Musk set the initial Aug. 8 date for the event months ago, and optimism about the spectacle contributed to an 11-day streak of gains that added more than $257 billion to Tesla’s market value. That rally ended Thursday, with the latest news contributing to an 8.4% drop in the firm’s share price, the biggest pullback since January. The idea of creating an autonomous taxi service has been kicking around Tesla for years, dating at least as far back as when Musk authored a second “master plan” for the company in 2016. The CEO has prioritized the project in recent months over work on an electric vehicle cheaper than Tesla’s most affordable car, the Model 3 sedan.
Source: Bloomberg