Weekly Recap: 12/16/24-12/20/24
Share
Market Summary:
This week all three major indices finished in the red, with the S&P down -1.99% ($5,930.85), the DOW down -2.25% ($42,840.26), and the NASDAQ Composite down -2.25% ($21,289.15). The Russell 2000 decreased by -4.45% ($2,242.37). Out of all the drawdowns, the SPDR XLK ETF (Technology) saw a weekly decline of -1.29%, the least among the other sectors, while XLE (Energy) fell by -5.69%. Darden Restaurants (DRI) saw a notable +12.5% increase to $187.59/share this week. Novo Nordisk (NVO), on the other hand, fell by -20.5% to $85.00/share.
DXY was flat for the week at $107.82. The 10-year yield rose by +2.84% to 4.5240%. Gold declined by -0.58% ($2,640.50). Crude decreased by -2.40% to $69.58/barrel. Bitcoin was down -10.42% to $95,081.59
Sources:
https://www.tradingview.com/markets/
Select Sector SPDR ETFs - Sector Spiders ETFs | SPDR S&P Stock
MACRO: The FED Cuts, Uncertainty Remains
The biggest macro story this week was the FED's meeting on Wednesday (December 18th), which resulted in an expected 25-point cut, putting the FED Funds Rate between 4.25% and 4.50%. Powell did make some comments on the state of the economy, saying that consumers are still feeling effects of prior inflation, evident through higher prices. The Fed chair also talked about future monetary policy decisions, stating that "When the path is uncertain, you go a little bit slower”. Core PCE Inflation is forecasted to rise by +2.80%, up from the previous +2.60%. The FED also expects cuts in 2025 to total 50 points, down from the 100 points forecasted in September.
Sources:
https://www.jpmorgan.com/insights/outlook/economic-outlook/fed-meeting-december-2024
PUBLIC MARKETS: Novo Nordisk Disappoints Market
In public markets, Novo’s newest CagriSema drug trial results came up shorter than management’s goals, showing that participants lost on average 22.7% of their body weight after 68 weeks. The goal set by management was 25%, which was achieved in 40% of participants. Despite the underperformance, the result is better than Eli Lilly’s Zepbound drug (21%) and Novo’s other weight-loss offerings: Ozempic (15%) and Wegovy (15%). Eli Lilly is currently almost done testing its new drug, retatrutide. According to an article by CNN, retatrutide “showed 24% weight loss after just 48 weeks.”
Sources:
https://www.cnn.com/2024/12/20/health/novo-nordisk-cagrisema-weight-loss/index.html
PRIVATE MARKETS: Bid War for Fujisoft Continues
In private markets, KKR and Bain Capital continue their bidding battle for Japan’s FujiSoft. Bain has recently been backed up by the founder and his family, who together own 18.6% of the company. Bain Capital had offered to buy Fujisoft shares at JPY9,600/share for 51.1% of the company, which is higher than KKR’s bid of JPY9,451/share. KKR already owns 33.9% from the earlier bidding round, which the board argues makes KKR a front-runner due to two large shareholders likely conflicting with each other down the road. The board also mentioned that Bain Capital’s acquisition would take a long time to go through.
Sources:
https://www.privateequitywire.co.uk/fuji-soft-backs-bain-in-pe-bidding-war/
https://www.privateequitywire.co.uk/bain-and-kkr-fuji-soft-battle-heats-up/
https://finance.yahoo.com/news/bain-4-2-billion-hostile-004748905.html
https://finimize.com/content/fuji-softs-founders-back-bain-capitals-bold-2-billion-bid
DISCLAIMER
The information provided in The Tulip Thesis is for general informational and educational purposes only and is not intended as financial, investment, or legal advice. The Tulip Thesis does not provide specific financial advice, investment advice, tax or legal advice. You should consult with a professional financial advisor, tax consultant, or attorney before making any investment or financial decisions.
The opinions expressed by contributors, authors, and editors are their own and do not necessarily reflect the views of The Tulip Thesis or its management. While we strive to provide accurate and up-to-date information, we make no representations or warranties, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained herein for any purpose.
Investing involves risk, including the potential loss of principal. Past performance is not indicative of future results. Readers are solely responsible for any actions they take based on the information in this publication. The Tulip Thesis shall not be liable for any loss or damage arising from the use of this information.
Disclosure: The Tulip Thesis, its owners, contributors, or affiliates may hold or trade securities mentioned in the blog.