The Fed’s in Its Feels

Tale of the Tape

Good evening, everyone, and happy hump day!! 🐫 

All four major indices closed negative after the Fed raised inflation expectations. The good ole’ FOMC rug pull. 💔

The Dow dipped 0.77%, the S&P 500 slid 0.54%, the Naz lost 0.24%, and the Russell 2000 gave up 0.23%.

Here’s today’s heatmap. It was rough out there…

Bitcoin blundered 4% to $38,500. Isn’t $BTC.X supposed to solve the inflation problem?? 🤣 $ETH.X traded 5.65% lower at $2,400.

Timberrr!! Lumber futures lost 14.35% today, closing below $1K. 🌳 🌲

$KIN climbed 45.6%, $AVXL advanced 21.5%, and $VINO vroomed 95%. 🔥

Here are the closing prints: 

S&P 5004,223-0.54%
Russell 20002,314-0.23%
Dow Jones34,033-0.77%

Earnings Roundup

Lennar reported earnings today. The homebuilding company beat on both top and bottom lines— s/o to the explosive housing market for that. 🏡 💥

Here are the numbers:

EPS: $2.65 vs $2.43 est
Revenue: $6.4B, +22% YoY

Lennar CEO Stuart Miller shared:

During the second quarter, the housing market remained very strong across the country, even as interest rates mildly ticked up. A combination of strong personal savings rates during the pandemic, strong stimulus from the government and a developing return to normalcy continued to drive the economy forward while bringing the housing market to new heights.

$LEN was flat after hours.

The Honest Company reported earnings for the first time since its IPO last month. 🎊

Here are the details:

EPS: ($0.05) vs ($0.06) est
Revenue: $81M, +12% YoY

Nick Vlahos, CEO of The Honest Company, said:

We had a strong start to 2021, reporting double-digit sales growth. This growth reflects the ongoing success of our strategic initiatives focused on Content, Community and Commerce, powerful innovation and category expansion. Honest is dedicated to providing safe, clean and effective products to consumers around the world and we are confident our strategy will help drive our mission of inspiring everyone to love living consciously.

$HNST lost 1% after hours.

The Fed’s in Its Feels

Today the Federal Reserve (America’s central bank) changed its timeline for interest rate growth amidst inflation concerns. 

During March’s meeting, the Federal Open Market Committee (FOMC) agreed to keep interest rates at zero… and that there would be no increasing interest rates until 2024. But today, the FOMC said it anticipates two [interest rate] hikes in 2023. 😬

This means the Fed will have to cut back its aggressive bond-buying program to accommodate future raises.

Some investors took the news for a sign that it’s time to pack it in— all major indices dipped.

Doge-Fight?? 🐶 🥊

Coinbase is one of the world’s largest crypto exchanges, and it’s listing Shiba Inu to capitalize on Memecoin popularity.

The news comes one month after the exchange listed Dogecoin. $SHIB, sometimes called the ‘‘Dogecoin Killer,’’ popped 30% in response. Technical issues delayed the launch, but investors should be able to trade and store Shiba Inu next week. 

Lately Coinbase has been ramping up its listing pipeline thanks to growing interest in cryptocurrency. In January, Coinbase launched Asset Hub, a platform for “asset issuers” to list coins on Coinbase.

Does this mean we’ll see a ‘‘Doge-fight?’’ 🐶 🥊 Maybe it’s fair to say joke currencies aren’t actually a joke anymore.

Roblox Reverses

Roblox dropped 8.2% today after the company reported its May 2021 key metrics. 🤷

Roblox raked in 43M daily active users (DAUs) in May (+28% YoY), though investors weren’t stoked about the 1% decline in DAUs since April 2021.

One of 2021’s hottest IPOs, Roblox rose as much as 43% since March. Thanks to the pandemic, the company experienced significant user growth with revenue up 123% YoY.

As the economy reopens, investors could be (understandably) weary about the revenue growth. $RBLX has shed 17.3% in the last two weeks.

DeFi’s Double-Digits 💰

Traditional crypto is starting to bleed into the forefront of DeFi (decentralized finance) in search of high yields and tendies. 

How high? Probably higher than your bank account. And maybe even (according to Vladimir Vishnevskiy) better than your stocks. Vishnevskiy and his firm are seeing double-digit yields.💰💸

Vishnevskiy buys tokens and lends them to “liquidity pools,” where they become available to traders. DeFi projects like Uniswap, Aave, Curve Finance, and Compound kick back fees to liquidity providers based on trading activity and demand.

If prices stay the same or appreciate, Vishnevskiy gets his tokens back at a higher price and gets interest generated from the pool’s transaction fees. 

It’s the wild west for DeFi apps, which currently boast over $60B in assets on Ethereum. Some have become stars of the recent bull run, ascending to billion-dollar market caps.

Scratching your head?? This strategy might be foreign to traditional traders, but it’s a real and lucrative one for crypto enthusiasts. 💸 🤑

Links That Don’t Suck

📈 Is the Closest Thing to a Crypto Bloomberg Terminal

🎧 Chris Bosh on How to Reinvent Yourself, The Way and The Power, the Poison of Complaining, Leonardo da Vinci

💰 Don’t Win the Game Too Early

🤖 Experts from Ford, Toyota and Hyundai Outline Why Automakers Are Pouring Money into Robotics

🏌The Top 7 Storylines at the US Open NOT Involving Brooks, Bryson or Phil 

🔋 GM Raises Electric-Car Bet, Will Add More Battery Factories

🏡 US Housing Market Needs 5.5 Million More Units, Says New Report