The Rundown - Boeing's Spaceship Launch, Nvidia Overtakes Apple with $3T Valuation

Episode Date: June 6, 2024

Stock market update for June 6th, 2024.

Public.com presents the rundown, your daily market update in five minutes. My name is Zadadmani, and today is Thursday, June 6th. In today's episode, we tell you why Boeing is making headlines again. And no, it's not a bad thing this time. Also, Microsoft's sneaky deal with an AI company is being investigated by the FTC. And then stick around to the end of the show to find out why eBay will no longer accept American Express. All right, let's go. Wednesday was a great.

great day for the stock market, the S&P 500, NASDAQ, and even the Dow were all in the green. And the S&P 500 ended the day at all-time highs, the 25th record close of the year. No surprise here, but the markets were carried by tech stocks yesterday, especially NVIDIA, which jumped another 5% yesterday, officially surpassing the $3 trillion market cap and overtaking Apple as the second largest company in the world. I think at this point we've all kind of gotten numb to the Nvidia thing, but this is truly like a historic run the stock has been on. The company was worth less than a trillion dollars a year ago. In fact, it was worth less than $2 trillion 50 days ago, but today it's worth $3 trillion and might become the largest company

in the world, all because everyone is just trying to get their hands on AI chips. Speaking of historic runs, Bitcoin has quietly been making moves as well, jumping past $70,000 and getting pretty close to that all-time high of $73,000. that was set back in March. It just feels like everything is hitting all-time highs all at the same time. Honestly, don't be shouted to open up the public app and take a peek at your portfolio because it's a good time to check it right now. Should be seeing a lot of green. Let's run through some headlines.

Starting with Boeing. Boeing is back in the news and it's not for a bad thing. Boeing launched their first reusable spaceship, the Star Line, into space, carrying two astronauts and a ton of cargo. The spaceship is headed to the International Space Station. NASA hired Boeing, along with SpaceX, to carry their astronauts and cargo to the International Space Station. SpaceX has been successfully doing it since 2020. Boeing has faced a ton of delays. But they finally pulled it off yesterday, even though the space project caused Boeing a ton of money, resulting in over $1.4 billion in losses. But frankly, I just think that they're relieved

that something positive happened after months and years of bad things happening with their planes. The industry for private space companies is definitely starting to mature. Both SpaceX and Boeing spaceships are designed to be fully autonomous and reusable, which results in significant cost savings. And NASA is hoping to alternate between SpaceX and Boeing for flights beginning next year. No, but seriously, though, how nervous do you think the astronauts were as they were getting ready for lunch? Given Bowen's reputation, I mean, I would have been. Speaking of nervous, Microsoft might be getting a little nervous right now because the FTC has opened an investigation into Microsoft's deal with an AI startup that they made earlier this year.

Back in March, Microsoft did I deal with AI startup inflection, and as part of that deal, they licensed the company's tech and also hired the co-founder of that company to lead Microsoft's AI efforts. Oh, and Microsoft also ended up hiring almost all of the startup's full-time employees as well. You know, it sounds like they pretty much just bought the company, but Microsoft was careful not to label it as an acquisition because they didn't want the regulators coming after them and, you know, try to block this deal. Well, that didn't work because now Lena Khan and the FTC are investigating Microsoft's deal. So, nice try Microsoft, but the feds are on to you. We'll see how this investigation. plays out. But yeah, one thing is clear. Lina Khan and the FECC are clamping down hard on tech

acquisitions. Let's talk about some stocks making moves today. Starting with Lulu Lemon. Shears are up this morning after Lulu reported earnings last night. And honestly, the earnings were okay, I guess. I mean, revenues were up 10% to $2.2 billion and profits were up to $321 million. Both those numbers were better than expected. But the company did project second quarter guidance to be lower than what analysts had forecasted, pointing to a slowdown in growth, especially in the U.S. I mean, we really shouldn't be that surprised to hear that, right? Because Lulu Lemon used to be the only Athleisure game in town, but these days it seems like every brand is launching an Athleisure line, which is definitely impacting Lulu Lemon's business. We all still love yoga pants,

but we don't necessarily have to get them from Lulu Lemon anymore. Despite the growth concerns, the stock is up more than 8% in the pre-market in reaction to these earnings. I think it might be because the company announced $1 billion in share buybacks. I mean, shareholders do love share buybacks. But still, though, it's been an absolute brutal year for Lulu Lemon investors. Stock is down 39% this year as of market close yesterday. So 8% pop helps, but investors are still way in the red for the year. And speaking of in the red, shares of five below are down big this morning after they reported their first quarter results. And it was a tough quarter for five below. They reported a 2% drop in same store sales. Five Below said that they're having a tough time

growing since consumers are spending money on necessities like food and not on $5 squishmallow toys. I mean, that Squishmallow craze last year was great for Five Below's business. I think I personally bought like six or seven for my daughter. But yeah, people aren't buying that anymore along with other toys because they're spending more money on food and other necessities. And that's hurting Five Below's sales and profits. Five Below expects sales to slump for the rest of the year. They're projecting same store sales to be down 3 to 5% this year, which is worse than what they had previously forecasted. So, yeah, investors did not like this news and the stock is down more than 15% in the pre-market in reaction to these earnings. All right, let's wrap the show with a fun fact.

eBay will no longer accept American Express because according to eBay, American Express charges unacceptably high fees. This probably shouldn't come as a surprise. A ton of retailers don't accept American Express because their fees are higher than rivals like Visa and MasterCorp. Because remember, every time you use your credit card, the merchant has to pay the credit card company a fee. And I guess eBay was sick of paying MX's high fees. MX does have the best perks, and I guess those perks aren't cheap. But American Express will be fine. Analyst's estimate that eBay was probably less than 0.5% of MX's worldwide volume. So not a lot. This isn't like when Costco dropped American Express back in 2015, which accounted

for like 10% of their volume back then. Well, all right, guys, that's the rundown for today. I hope you guys enjoyed today's episode. If you have a couple seconds, please consider giving us a five-star rating on Apple and Spotify. The ratings really do help the show. And don't forget to vote in today's Spotify poll as well. Thank you guys so much for listening. Shout out to Connor for all the help behind the scenes. We'll see you guys back here tomorrow.

This is the rundown, your real-time resource for news events and trends in the markets. All views presented in this show reflect the opinions of the guests. You should not take any mention of a publicly traded security as recommendation to buy, sell or hold that security. Run-down guests are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult. Respective professionals. Learn more at public.com disclosures. In partnership with Zaididmani, brokerage services for U.S. listed, registered securities are offered by Open to the Public Investing Incorporated, member FINRA and SIPC.