Welcome to the Weekly Market Review. This section is dedicated to providing Moomoo CAB members with the core investment news and insights of the week, as well as a preview of major events that will impact the market in the coming week.

Macro trend

In June, the inflation rate decreased by 0.1% compared to the previous month.

US CPI in June decreased for the third consecutive month from 3.3% in May 2024 to 3.0%. US core consumer prices rose 3.3% YoY in June 2024, lower than 3.4% in May.

Compared with the previous month, CPI unexpectedly decreased by 0.1%, which was the same as in May and lower than the expected 0.1%. Core CPI rate fell slightly from 0.2% to 0.1%, lower than the expected 0.2%.

Powell warns that maintaining high interest rates for a long time can harm the economy.

Federal Reserve Chairman Jerome Powell expressed his concerns on Tuesday, believing that maintaining high interest rates for a long time may jeopardize economic growth.

Powell said when appearing on Capitol Hill this week, "Reducing policy restrictions too late or too little could overly weaken economic activity and employment."

The market expects the Fed to start cutting interest rates in September and may cut rates by another 0.25% before the end of the year. However, FOMC members only mentioned one interest rate cut in the June meeting.

After a moderate inflation report, the Chicago Mercantile Exchange federal funds futures market priced with a 95% probability that the Fed would cut interest rates in September.

Gold broke $2,400 in June when CPI decreased.

The gold market responded positively to the CPI report, with spot gold currently trading at $2413.92, representing a significant increase of $42.79 or 1.8% during the day; the August delivery of gold futures also showed clear growth, reaching $2421.90, up $42.20 or 1.77% as of ET5:20PM; August contracts reached a intraday high of $2430.40.

Fund Flows.

Small cap stocks outperformed large cap stocks by 4.5% on Thursday, which is a 6 standard deviation event and the second largest relative outperformance to the S&P on record.

Seasonal analysis indicates that late July may be a relatively weak period for the US stock market in presidential election years.

In June of this year, Bank of America invested $12 billion in emerging market stock funds (par with the previous three months), but almost all the funds flowed into China ETFs.

Company news.

After the delay of the robotaxi unveiling, Tesla's stock price fell 8% at the close.

Tesla's stock price closed down about 8% on Thursday. Bloomberg reported that the electric car maker will delay the launch of its robot taxi by two months.

According to people familiar with the matter cited by Bloomberg, Tesla previously announced it would launch robot taxis on August 8 but has now pushed back the release date to October to allow the project team more time to build prototypes.

With the soaring demand for artificial intelligence, TSMC's Q2 performance may push up its $420 billion.

The world's largest contract semiconductor manufacturer may report a 29% increase in net income for the second quarter on July 18, according to the median estimate of analysts surveyed by Bloomberg. More importantly, analysts from JPMorgan to Morgan Stanley expect the company to raise its full-year sales guidance, demonstrating the reasonableness of another round of valuation expansion.

Delta's stock retreats after Q2 results fall short of expectations for airlines.

Delta Airlines reported adjusted EPS of $2.36, down 11.9%, slightly below FactSet's view of $2.37 per share. Adjusted revenue increased 5.4% to $15.41 billion, a quarterly record at the end of June. However, Delta's sales performance fell short of the expected $15.45 billion revenue. Delta Airlines guides Q3 EPS to be between $1.7 and $2 per share, down from $2.03 per share last year.

DAL stocks fell 3.9% on Thursday, reaching their lowest level since March. The stock price plummeted 7.5% in early trading.

Important economic data of the week

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