📈 Cancer Drug Sends Stock Flying

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Good Morning & Happy Friday.

Today is packed, from US stocks surging on cooling inflation news to BlackRock’s bold take on Bitcoin. Plus, Summit Therapeutics continues its hot streak, Moderna faces a major stock plunge, and OnlyFans reveals record-breaking revenue numbers.

Grab your iced latte and let's get into it! ☕️👇️

Markets

On Thursday, US stocks jumped as investors digested fresh inflation and labor reports, with many betting on a quarter-point interest-rate cut next week.

The S&P 500 climbed 0.7%, marking its fourth straight winning session. Tech stocks pushed the Nasdaq Composite up by 1%, while the Dow Jones Industrial Average saw a 0.6% gain.

Thursday’s release of the August Producer Price Index hinted that inflation might be easing, further fueling market optimism.

🏦 BlackRock says Bitcoin Is A Hedge Against Global Disorder
BlackRock, a $9 trillion asset manager, views Bitcoin as a hedge against global disorder and geopolitical uncertainty. The company called it a global monetary alternative that could protect against declining trust in governments, banks, and fiat currencies.

🏥 Summit Therapeutics, With 85% Gain This Week, Rockets Again
Summit Therapeutics (SMMT) stock soared Thursday, adding to an 85% gain this week after raising $235 million in a private placement. This surge followed a key presentation at the World Conference on Lung Cancer, where Summit's drug ivonescimab was shown to reduce the risk of progression or death by 49% compared to Merck's Keytruda.

Summit shares rocketed 56% on Monday and added another 20% Tuesday, while Merck stock dropped 2.1%.

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🩸 Moderna shares plunge on plans to cut $1.1 billion in costs
Moderna announced plans Thursday to cut $1.1 billion in expenses by 2027 and seek approvals for new products amid the sharp decline of its Covid business. Despite the cost-cutting efforts, Moderna's stock dropped over 15%.

🤳 OnlyFans reveals record-breaking revenue
OnlyFans saw a 28% surge in user accounts over the past year, reaching 305 million fans, according to its 2023 earnings report. Revenue hit a record $1.3 billion, with owner Leonid Radvinsky receiving over $472 million in dividends, bringing his total earnings past $1 billion since acquiring the company in 2018.”

EARNINGS

Tether Is More Profitable Than BlackRock?

Tether has been posting staggering quarterly profits, raking in $12.72 billion since Q4 2022, surpassing BlackRock's $9.83 billion. But Tether’s numbers aren’t purely from US Treasurys— they also include unrealized gains from its bitcoin and gold holdings.

As of Q2 2023, Tether reported $1.3 billion in profit, with $118.44 billion backing its tethers. Much of this comes from US Treasurys, which currently yield around 4.85%. However, Tether's $4.52 billion Q1 profit was inflated by bitcoin’s 70% price surge.

The catch? If bitcoin or gold prices drop, Tether’s profits shrink, as seen when Q2 bitcoin prices fell 12%, dropping Tether’s profit by 70% compared to Q1. Without these assets, Tether’s earnings would fall to $7.7 billion, still impressive, but short of BlackRock's.

ECONOMY

Has the Fed waited too long?

The Federal Reserve is widely expected to cut its benchmark interest rate next week for the first time in four years, after keeping rates at a two-decade high to combat inflation.

The central bank had raised rates since 2022, but now that inflation has cooled to 2.5%, economists are asking why the Fed waited so long to act.

Dan North, senior economist at Allianz, says that the Fed often "waits too long" to cut rates. Despite inflation nearing the Fed’s 2% target, the labor market is weakening, adding urgency to a rate cut.

Some experts, like Kathy Bostjancic of Nationwide, believe the Fed should have acted sooner, given the signs of a softening economy. Bill Adams of Comerica Bank argued that while the Fed feared missing its inflation target, delaying a rate cut may have worsened the job market.

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