Investors gave a big thumbs up to the latest US inflation figures which were below expectations, triggering a big rally on Wall Street and putting the Nasdaq index back in bull territory.
The US consumer price index advanced by 8.5% year-on-year in July versus forecasts of 8.7%. Investors took this as a positive sign that pressures on consumers and businesses could soon start to ease.
The Nasdaq jumped 2.9% on 10 August following the news, hitting 12,854. That means it is now up 20% since the 16 June low - the definition of a bull market. More than 130 stocks on the Nasdaq have delivered gains greater than 100% since that market low point two months ago, led by biotech stocks, according to SharePad data.
Some of the better-known names in other sectors to have soared since mid-June include a 92% gain from fried chicken seller Wingstop (WING:NASDAQ) and an 84% advance from cryptocurrency exchange platform Coinbase (COIN:NASDAQ).
DISNEY
‘Disney's the king of the streamers in, the jungle of TV’ - if Louis Prima were still about, he couldn't have reworded his Jungle Book classic any better.
Disney (DIS:NYSE) stock jumped 8% after the House of Mouse bucked a streaming slowdown that has recently bedevilled Hollywood, with Disney+ subscriptions soaring ahead of expectations thanks to the release of hit shows like Star Wars series Obi-Wan Kenobi and Marvel's Ms Marvel.
Now, at 152.1 million, bolt-on Disney-owned Hulu's 46.2 million and another 22.8 million for ESPN+, it means Disney now has more paying streaming customers than Netflix (NFLX:NASDAQ), with 220.67 million. Disney's theme parks are also holding up to cost-of-living pressures, with strong demand for vacations, despite economists' worries about an inflation-led downturn in consumer spending, helping powered Disney's increase in profits.
Streaming subscriber growth was top sliced, down from a range of between 230 million to 260 million by the end of fiscal 2024. It now anticipates 215 million to 245 million subscribers, but investors are happy to look on the bright side for now.
TYSON FOODS
Staff shortages and supply chains squeezes took the meat out of Tyson Foods' (TSN:NYSE) burger over the past week, with third quarter earnings missing expectations.
The Arkansas-headquartered food company, a major processor of chicken, beef and pork, served up adjusted quarterly earnings per share of $1.94, down 28% year-on-year and missing estimates for $1.98. That's despite sales of $13.5 billion, up from $12.48 billion a year earlier, beating the $13.25 billion Wall Street was looking for.
CEO Donnie King may claim ‘solid results’ thanks to ‘operational excellence and aggressive cost management,’ yet a near 10% slump in the stock price suggests that investors see it otherwise. Tyson has set itself a goal of delivering more than $1 billion in recurring productivity savings by the end of its 2024 financial year.
MEME STOCKS
In a sign animal spirits are alive and well in the US stock market, investors have been chasing up shares in former ‘meme’ stocks this month. Since the start of August, shares in cinema operator AMC Entertainment (AMC:NYSE) have rallied 60% to almost $24 after languishing below $15 for most of the preceding three months.
A study in the Wall Street Journal showing a shift in consumer spending back towards cinema-going may have been partly responsible for the renewed interest. However, AMC isn't the only former ‘meme’ stock to have surged this month, with shares in entertainment firm GameStop (GME:NYSE) gaining nearly 30% to $43.45.
Part of the attraction has undoubtedly been the remarkable performance of newly-listed Hong Kong-based fintech AMTD Digital (HKD:NYSE), whose shares have rallied 32,000% from their $7.80 initial price in July to an intra-day high of $2,355 in just three weeks.
