Business and Finance News - 7.12.24

Author

Skool Projekt Staff
July 12, 2024

 

Good Morning, Students!

 

An index fund is a type of mutual fund specifically designed to replicate the performance of a particular market index, such as the S&P 500. It achieves this by holding a portfolio of assets that closely mirrors the components and weightings of the target index. This passive investment strategy aims to provide broad market exposure, low operating expenses, and minimal portfolio turnover.

 

Invest in index funds to achieve diversified growth with lower fees.

 

-Mr. W

 

TOP STORIES

Citigroup Fined $136M by Regulators for Persistent Risk Management Issues

  • Citigroup fined $136 million for unresolved risk management issues.

  • Federal Reserve and OCC imposed the fines.

  • Issues first identified in a 2020 consent order.

  • Citigroup previously paid $400 million related to the 2020 order.

  • CEO Jane Fraser emphasized commitment to addressing the consent orders.

  • Citigroup’s stock dropped over 1% after the announcement.

  • Fraser's transformation strategy includes cutting jobs and focusing on multinational services.

*Citigroup (C) - Citigroup Inc., commonly known as Citi, is a global financial services corporation with a wide range of financial products and services.

 

CPI Declines 0.1% in June, Annual Rate at 3%; Core CPI Up 3.3%, Gas Prices Down 3.8%

  • The Consumer Price Index (CPI) declined 0.1% from May, reaching a 12-month rate of 3%.

  • Core CPI, excluding food and energy, increased 0.1% monthly and 3.3% annually.

  • Gasoline prices fell 3.8%, offsetting 0.2% increases in food and shelter.

  • June's monthly inflation rate decreased for the first time in over four years.

  • Real average hourly earnings for workers increased 0.4% monthly.

  • Stock market futures rose and Treasury yields fell after the report.

  • Traders increased bets on a September Fed rate cut following the inflation report.

*Consumer Price Index (CPI) - The CPI is a measure that examines the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. It is commonly used as an indicator of inflation, reflecting the cost of living and purchasing power in an economy.

 

Costco Raises Membership Fees for First Time Since 2017; Shares Rise 2% Post-Announcement

  • Costco is raising U.S. and Canada membership fees by $5, and higher-tier by $10.

  • This is the first membership fee increase since 2017.

  • New fees: $65 for annual, $130 for Executive Membership, starting Sept. 1.

  • The increase affects about 52 million memberships, half are executive.

  • Costco relies on membership fees to keep prices low and compete with Sam's Club and BJ's.

  • Shares rose 2% in extended trading following the announcement.

  • Costco has increased membership rates approximately every 5.5 years.

*Costco (COST) - Costco operates a membership-based warehouse club that provides a wide variety of goods and services at discounted prices, including groceries, electronics, clothing, and household items, along with additional offerings like gas stations, pharmacies, and travel services.

 

PepsiCo Misses Q2 Revenue Estimates; North American Volume Declines, Cautious Full-Year Outlook, Shares Drop 1%

  • PepsiCo missed Q2 revenue estimates as North American units reported declining volume.

  • The company gave a cautious outlook for full-year sales, expecting 4% organic revenue growth.

  • PepsiCo beat earnings estimates with $2.28 per share against $2.16 expected.

  • Q2 net income rose to $3.08 billion, or $2.23 per share.

  • North American volume declined: Frito-Lay down 4%, beverages down 3%, Quaker Foods down 17%.

  • PepsiCo's international business fueled a 1.9% increase in organic revenue.

  • Shares fell more than 1% in early trading following the report.

*Pepsico (PEP) - PepsiCo is a multinational food, snack, and beverage corporation headquartered in Purchase, New York.

 

Pfizer Advances Once-Daily Weight Loss Pill Danuglipron Amid $100B GLP-1 Market Competition

  • Pfizer to develop once-daily weight loss pill, danuglipron, after encouraging early-stage trial data.

  • Studies on multiple doses will be conducted in the second half of the year.

  • Pfizer discontinued twice-daily version of danuglipron due to tolerability issues.

  • No liver safety issues observed in once-daily formulation of the drug.

  • Pfizer competes in the $100 billion GLP-1 weight loss drug market.

  • Investors skeptical after previous setbacks and decline in Pfizer's Covid business.

  • Pfizer exploring licensing deals and earlier-stage weight loss drug acquisitions.

*Pfizer (PFE) - Pfizer is a global pharmaceutical company that develops, manufactures, and markets a wide range of healthcare products, including prescription medicines, vaccines, and over-the-counter treatments, with a focus on advancing health through innovative therapies and solutions.

 

THE MARKETS

Here’s how the markets closed yesterday:

 

Here’s how leading market ETFs did yesterday:

 

Here’s how the THE SUPER SIX STOCKS did yesterday:

Disclaimer: This content is not intended as financial guidance. The purpose of this newsletter is purely educational, and it should not be interpreted as an encouragement to engage in buying, selling, or making any financial decisions regarding assets. Exercise caution and conduct your own research before making any investment choices.