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- 👉 The Investing Week Ahead: WW3 Scare
👉 The Investing Week Ahead: WW3 Scare
Madness over the weekend...
Welcome to your new week.
Before we dive in — here are two quick callouts:
1) Fears of WW3
On Saturday, you may have noticed that chaos was breaking out over the Iranian attacks on Israel. Iran launched over 300 drones and missiles into Israel — which they claim to be in self-defense to Israel attacking its embassy in Syria last month. We’re not here to break all of this down for you — but we are praying for peace. If you want to read more, check this link.
The events resulted in crypto prices naturally seeing an overreaction of selling, as it was the primary market that stays “open” during weekends. If you want to follow the best account for macro crypto thoughts, check this link.
2) Mind the Business: Small Business Success Stories
With the stresses of tax day returning today — there’s no better time to share my podcast in partnership with iHeart Media and Intuit Quickbooks.
Mind The Business is an interview podcast where myself and Jannese dig deep into learning more about the ups and downs of owning a small business.
Even if you don’t have your own business currently — it’s incredible to get a glimpse into the lives of budding entrepreneurs and find new business tips.
I highly encourage you to tune in!
Key Earnings Announcements:
Key updates on corporate America with earnings from major financial institutions, alongside Netflix, Taiwan Semiconductor, and United Airlines.
Monday (4/15): Charles Schwab, First Bank, Goldman Sachs
Tuesday (4/16): Bank of America, Bank of New York Mellon Corp, Ericsson, J.B. Hunt Transport Services, Johnson & Johnson, Morgan Stanley, United Airlines
Wednesday (4/17): Alcoa Corp, ASML Holding, Citizen Financial Group, CSX Corp, Crown Castle, Discover Financial Services, Kinder Morgan, US Bancorp
Thursday (4/18): Alaska Air Group, Ally Financial, Blackstone Group, Intuitive Surgical, Netflix, Nokia, Taiwan Semiconductor Manufacturing Company
Friday (4/19): American Express, Fifth Third Bancorp, Proctor and Gamble Company, Regions Financial Corp
What We’re Watching:
Netflix is on track to report Q1 earnings this Thursday — the company has beat Wall Street’s expectations for 6 out of the last 8 quarter now. The company's strategies — including a crackdown on password sharing and new ad-supported tiers — have propelled the stock up nearly +30% YTD.
Analysts are predicting a +58% year-over-year increase in EPS to $4.52 and a +13.6% rise in revenue to $9.28 billion — driven by cost efficiencies and strong subscriber growth. These figures could lead to Netflix's highest quarterly sales in its 27-year history.
TSMC recently reported strong revenue growth for the month of March, coming in at $6.1B (+34.3%). This marked the fastest growth since November 2022 given the continued demand for advanced AI chips.
During Q1, TSMC's revenue grew to $18.03B — up +16.5% YoY. The company’s stock share price is up nearly +40% this year.
Investor confidence remains high as AI-specific revenue continues to grow at +50% annually. Wall Street is projecting a +24% increase in revenue for 2024.
This revenue growth is catalyzed by the below:
Investor Events / Global Affairs:
With the Bitcoin halving and geopolitical chaos — the focuses this week are BTC, gold, and oil.
Bitcoin Halving
The Bitcoin halving event, expected on April 19, will reduce miner rewards from 6.25 BTC to 3.125 BTC per block — increasing the leading cryptocurrency’s scarcity as its total coin supply approaches the 21 million cap.
The landmark event for all of crypto has often been a catalyst for triple-digit-percentage gains in the months after it takes place. It’s certainly one of the major contributors to market expectations of $150K+ per Bitcoin by the end of 2025.
"Digital asset investors and traders are asking the question ‘is the halving priced in’ and each cycle it tends to not be. Similarly, many investors thought the BTC ETF approval was also priced in, but over the first 60 days of ETF trading bitcoin price rallied considerably.
Why? Because these particular events lead to real changes in supply and demand mechanics on exchange order books.”
Crude Oil Reacts to Middle East Conflict
Oil prices are poised to surge following Iran's direct attack on Israel over the weekend — the first such aggression launched from Iranian territory.
U.S. West Texas Intermediate crude futures and Brent crude saw increases ahead of the weekend — with Brent reaching a high of $92.18 a barrel.
This uptick is compounded by extended supply cuts from OPEC — driven by leaders like Mohammed bin Salman and Vladimir Putin — who are leveraging these reductions to manipulate market prices.
Analysts warn that the price spike could persist depending on further developments — including Israel's response and international diplomatic efforts. With Iran being OPEC’s third-largest oil producer — any escalation affecting its 3 million barrels per day output could significantly disrupt global oil supplies and prices.
"I think oil will open higher… Also signs that Iran wants to enact a soft blockade of the Strait of Hormuz is a concern, as this means there are potential both supply chain disruptions and higher oil prices. We have entered a dangerous period ahead of the U.S. elections."
— Tina Fordham, Founder & Strategist at Fordham Global Foresight
Goldman Upgrades Gold Amid Rising Geopolitical Tensions
Gold prices are set to finish the year higher than previously anticipated as emerging market central banks continue to build their gold reserves during global geopolitical tensions.
According to Goldman Sachs — the year-end target for gold has been raised from $2,300 per ounce to $2,700 per ounce. This reflects a rally that saw prices soar over +20% in the last two months — hitting a new record of $2,400 per ounce.
This surge is attributed to heightened tensions in the Middle East and large-scale buying from Asian markets.
Despite traditionally higher interest rates bolstering the U.S. dollar against gold — the current economic environment has still seen gold prices rise alongside real interest rates. Goldman Sachs points out that the continuing demand for gold — driven by both "fear and wealth” — is likely to persist.
"The reality is that the near-term potential for a combination of developments that could dampen gold's rally is low, which underpins our bullish stance on the precious metal's future.”
Major Economic Events:
Existing home sales, housing starts, industrial production, retail sales and U.S. leading economic indicators round out the week.
Monday (4/15): Business inventories, Empire State manufacturing survey, Home builder confidence index, New York Fed President John Williams TV appearance, Retail sales minus autos, San Francisco Fed President Mary Daly speaks, U.S. retail sales
Tuesday (4/16): Building permits, Capacity utilization, Fed Chair Jerome Powell speaks, Fed Vice Chair Phillip Jefferson speaks, Housing starts, Industrial production
Wednesday (4/17): Cleveland Fed President Loretta Mester speaks, Fed Beige Book, Fed Governor Michelle Bowman speaks
Thursday (4/18): Atlanta Fed President Raphael Bostic speaks, Existing home sales, Fed Governor Michelle Bowman speaks, Initial jobless claims, New York Fed President John Williams speaks, Philadelphia Fed manufacturing survey, US leading economic indicators
Friday (4/19): Chicago Fed President Austan Goolsbee speaksWhat We’re Watching:
“The U.S. LEI rose in February 2024 for the first time since February 2022,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. “Strength in weekly hours worked in manufacturing, stock prices, the Leading Credit Index™, and residential construction drove the LEI’s first monthly increase in two years.
However, consumers’ expectations and the ISM® Index of New Orders have yet to recover, and the six- and twelve-month growth rates of the LEI remain negative.
Despite February’s increase, the Index still suggests some headwinds to growth going forward. The Conference Board expects annualized US GDP growth to slow over the Q2 to Q3 2024 period, as “rising consumer debt and elevated interest rates weigh on consumer spending.”
Investors will receive a new update on Monday with the March retail sales report — economists anticipate a +0.4% increase from the previous month. This would continue the rebound that began in February following a -1.1% decline in January.
"We do not think consumer spending is poised to slow meaningfully, especially as wage growth remains solid. Real-time credit card spending data show consumer outlays remaining above their pre-pandemic trend in March."
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If you want to check out the full episode list of the Rich Habits podcast, click here.
Disclaimer: This is not financial advice or recommendation for any investment. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.
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