Markets took a hit over the weekend, after Hamas launched it’s largest attack on Israel in 50 years, and Israel declaring war. If there is one thing investors don’t like, it is uncertainty.
Outside of the Middle East, the suspension of mining activity in Myanmar has caused rare earth prices to surge. Rare earth supply chains are predominantly concentrated in a handful of countries, with a critical importance powering most modern technology.
Grab your Grande triple shot espresso in orange juice and let's get into it! 😅 ☕️👇️
Coffee submitted by Jaxpi- Send us your favourite order to win free Investing Journal Premium!
Oil prices jump as Middle East turmoil roils markets (3 minute read)
On Monday, oil prices experienced a significant rise, exceeding 2%, due to escalating military confrontations between Israel and Hamas, raising concerns about a potential broader conflict in the Middle East. Brent crude surged by 2.7%, reaching $86.86 per barrel. Benchmark prices showed an initial spike of over $4 per barrel earlier in the session. This surge in oil prices countered the previous week's downward trend, marking the most significant weekly decline since March. Tamas Varga, an oil broker at PVM, noted that while the fundamental supply-demand balance remains unchanged, any escalation of tensions in the Middle East typically triggers an increase in oil prices, echoing the pattern in this instance. Over the weekend, Hamas initiated the most extensive military attack on Israel in decades, prompting a series of retaliatory Israeli airstrikes on Gaza.
S&P 500 futures tumble after Hamas attacks Israel (3 minute read)
Early on Monday, U.S. stock futures experienced a decline in response to heightened violence in the Middle East. The S&P 500 futures dropped by 0.8%. Similarly, Dow Jones Industrial Average futures saw a loss of 0.7%. Richard Hunter, the head of markets at Interactive Investor, noted that such geopolitical tension traditionally has a negative impact on investor sentiment, causing apprehension about increased uncertainty. While the U.S. Treasury market remained closed for Columbus Day and Indigenous Peoples Day, futures trading indicated a decrease in benchmark yields. Jim Reid, a strategist at Deutsche Bank, highlighted that geopolitical risks may not persist in markets for an extended period, but potential second-order impacts could manifest in the coming weeks, months, and years as a result of the recent weekend developments.
Rare Earth Prices Skyrocket Following Burmese Mining Suspension (4 minute read)
The Monthly Metals Index for Rare Earths experienced a notable and consecutive increase, primarily due to ongoing concerns about supply disruptions within the rare earths industry. One significant disruption stemmed from the suspension of mining activities in Myanmar's Kachin State, a key global producer of rare earths. This suspension prompted stockpiling in anticipation of high consumption periods, driving Chinese rare earth prices to their highest point in over 20 months. Notably, Kachin State, contributing 38% of China's rare earth imports, saw a halt in mining operations, leading to an immediate and substantial spike in global prices, resulting in a 6.62% increase in the index.
The best investments of Q3? (1 minute read)
During the third quarter, crude oil and short-term, highly secure cash-like investments emerged as top performers, while long-term bonds faced significant challenges. The surge in crude oil prices in recent months, propelled by production cutbacks led by OPEC+ members like Saudi Arabia and Russia, has reignited concerns about inflation. Additionally, investors who anticipated and invested in rising oil prices saw favorable returns. The S&P 500 energy sector rose by approximately 14% in Q3, marking the sole industry component within the benchmark index to achieve gains. Similarly, the U.K.'s commodity-centric FTSE-100 also experienced a respectable performance during this period.
Why Lemonade Stock Lost Nearly 16% in September (2 minute read)
Lemonade's shares experienced a further 16% decline in September, following a mixed earnings report that left investors disappointed due to certain critical points. The artificial-intelligence-driven digital insurance platform has been impressing customers, with its customer count reaching 1.9 million in the second quarter, a notable 21% increase from the previous year. However, challenges persist, particularly their net loss, which remains high and is not decreasing rapidly. In the second quarter, the net loss amounted to $67.2 million, slightly lower than the $67.9 million reported the previous year.
Made in Mexico: Nearshoring Is Accelerating Growth (5 minute read)
Reshoring and nearshoring have emerged as significant trends capturing the attention of global market investors. As geopolitical tensions escalate and businesses increasingly shift their operations away from China, investors are carefully evaluating the implications of deglobalization. Within this landscape, Mexico appears poised to experience substantial growth and stands out as a major beneficiary. A significant proportion of corporate executives are planning heightened levels of investment in the country. These plans encompass expanding production, increasing hiring, and acquiring additional real estate to capitalize on nearshoring opportunities.
A Recession Preparation Checklist To Survive Bad Times (5+ minute read)
Are you prepared for a potential recession? With surging interest rates, escalating oil prices, declining stock markets, government slowdowns, rising layoffs, and a stagnating housing market, the signs of an impending recession are evident. It's crucial not to procrastinate in getting ready for what might lie ahead. To assist you in preparing effectively for a potential recession, here are ten essential strategies. It appears increasingly likely that the Federal Reserve is inclined towards a recession to address inflation, necessitating a proactive and adaptive approach on our part.
📊 Poll Results
Are you in favor of the recent $9 billion student debt relief announcement by President Biden?
🟨🟨🟨🟨⬜️⬜️ ✅ Yes, it's a step in the right direction!
🟩🟩🟩🟩🟩🟩 ❌ No, I think there are better ways to address the issue.
⬜️⬜️⬜️⬜️⬜️⬜️ 🤷♂️ I'm not sure; I need more information.
I: “The devil is always in the details. Until they are revealed, I remain undecided.”
S: “I think that people should be held accountable for the decisions (good and bad) that they have made. Forgiving those who made poor financial decisions places the burden on the rest of society.”
M: “All people need to learn that, if they sign a contract, they are obligated to pay the debt. ”