The Rundown - Nike Tanks After Sales Warning, Trump Media Volatile Following Presidential Debate

Episode Date: June 28, 2024

Stock market update for June 28, 2024.

Public.com presents the rundown, your daily market update in five minutes. My name is Zadmani, and today is Friday, June 28th. On today's episode, we'll update you on the latest inflation report and why the Fed might actually cut rates this year. Also, Nike seems to be struggling. We'll tell you why investors are very nervous right now. Then stick around to the end of the show to find out how much it's going to cost to host a 4th of July cookout this year.

Spoiler alert, prices are going up. All right, let's go. Stocks continued to move higher on Thursday by a little bit. The Dow, S&P, and NASDAQ all finished in the green, despite Nvidia dropping close to 2%. Usually the market just does whatever Nvidia does, but not yesterday. Overall, though, it was a low volume kind of day as investors waited for the PCE inflation report, which just dropped this morning. So let's talk about the PCE report because it's more good news when it comes to inflation.

According to this report, inflation in May was 2.6. percent compared to a year ago and up 0.1 percent from April. Both of those numbers were in line with estimates. In fact, this is the lowest annual rate since March of 2021. I've mentioned this before, but the PCE report is the Fed's preferred inflation measurement. The CPI gets all the headlines, but the PCE is what the Fed likes to look at. And if the PCE is showing the lowest inflation in three years, I mean, maybe we might end up getting that rate cut this year. No surprise here, but the stock market futures are lighting up with green after this report. If the S&P and NASS, like ended up finishing in the green again this week, which is what they're on track to do.

That'll make it nine out of the last 10 weeks as winning weeks. I keep saying this, but the stock market is on an absolute role right now. Let's run through some headlines. Starting with Nike. Things aren't looking so great for Nike right now. They're losing a step in the sportswear business. See what I did there? Step.

Okay. Shares of Nike are down like 15% this morning after the iconic shoe retailer reported earnings that were very disappointing. The revenues last quarter dropped by 2%, which was worse than estimated, and to make matters worse, they're saying that the revenues for this current quarter are expected to drop by 10%. Dude, that's crazy. As a result, Nike lowered their full year guidance, citing weaker demands at its stores and challenging macro trends in China where Nike gets like 15% of its revenue. Last quarter also wrapped up Nike's fiscal year for 2024, and it was actually the slowest pace of annual sales growth the company has seen since 2010.

not including COVID. The thing is Nike is dealing with a lot more competition these days. People are ditching Nike running shoes for newcomers like Hokas and On, which I've stole markets here from Nike. Nike's footwear sales were down 4% last quarter, while Hokka, which is owned by Decker's, grew by 34%. I mean, I'm not going to lie, I have seen Hokas everywhere these days. Nike's management has owned up to the fact that its innovation has been lacking lately

and that it's going to be a priority moving forward. The company is hoping the Paris Olympics will help bring the brand back to its elite reputation and shed some light on its new products. But they clearly have a lot of work to do to win back some customers and investor confidence. Nike shares are down more than 10% this year as of closed yesterday and they dropped another 15% in the pre-market following these earnings. So not a great year for Nike. Here's a free tip for Nike executives. Somehow incorporate AI into your shoes. It might not even make any sense, but I think if you dropped a couple AI's in there, it could help based on how the markets are moving these days. Let's shift gears and talk about

meta. Meta is testing AI tools for Instagram that will allow you to make an AI that mimics your IG account. This sounds kind of spooky. Creators and businesses will be able to make a chat box copy of their Instagram page that will have the ability to chat with their fans and followers. I mean, Zuck is a smart guy, but we can all agree that everybody hates the chat boxes that businesses have, right? I don't want to chat with an AI business. I want to chat with a real human. And I definitely don't want to chat with like an AI version of a creator or an athlete or a celebrity. I mean, what? I'm not really sure how I feel about training an AI to steal my identity and replicate myself, you know?

It sounds like the start of every sci-fi movie we've ever seen for the last 30 years. But maybe I'm not seeing something here. Meta's going to start releasing this AI tool as a test in the U.S. So we'll find out pretty soon. Can't wait to DM AI LeBron to ask if Brony's actually good at basketball. Let's talk about some stocks making moves today. starting with Trump media. DJT is up this morning following the presidential debate yesterday

where President Biden raised some alarms after stumbling on his words on several occasions. Biden's performance has widely been criticized by political analysts and Democratic donors, according to CNBC, and some investors are seeing this as an opportunity to grab shares of Trump media. Shares of Trump media are up more than 10% in the pre-market this morning, so the market clearly picked the winner from last night,

but shares of Trump media are still worth half of their 52-week high of $79. Currently, the market cap of Trump media is north of $6 billion, and Donald Trump owns nearly 65% of DJT shares. On the flip side, stock not doing so good this morning is Foot Locker. I think this is the case of Foot Locker just catching some strays from Nike stock dropping so hard this morning after their really bad earnings report. Because obviously, Foot Locker is a major seller of Nike shoes, and if Nike's warning of sale slowdown, it's likely going to affect Foot Locker's business too. And as a result, Foot Locker's stock is down more than 4% in the pre-market. Let's wrap the show with the fun fact.

The price of a 4th of July cookout this year will cost 5% more compared to last year. This is according to the U.S. Farm Bureau. According to their estimates, the cost to host 10 people will cost about $71 this year compared to $67 last year. Honestly, I thought it would be a little bit more than that. This includes the price for hot dogs, hamburgers, corn, fireworks, of course, the typical 4th of July stuff. The biggest price increase this year was ground beef, which was up 11% this year compared to last year. So while inflation is coming down, some things are still going up in price. On a side note, I'm kind of ashamed to admit this, but as a dad of two, my grill game is extremely

disappointing. Okay, I just never got good at it, but I think I'm going to work on that this summer because I don't think I can be a full-on dad if I can't smoke meats properly. So something I need to improve on this summer. Well, all right, guys, that's the rundown for today. That's the rundown for this week. Another week in the books. We're kind of hitting that summer lull, but there's still stuff happening every day in the

markets. Don't worry. We got you covered all summer. guys enjoy this show and have like eight seconds, hit us with that five star rating on Apple and Spotify. That engagement really does help the show. Thank you guys again for listening. Shout out to Connor and Mike for all the help behind the scenes and we'll see you guys back here on Monday. This is the rundown, your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests. You should not take any

mention of a publicly traded security as a recommendation to buy, sell or hold that security. Rundown 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. respect to professionals. Learn more at public.com disclosures. In partnership with Zaididamani, brokerage services for U.S. listed, registered securities are offered by Open to the Public Investing Incorporated, member FINRA and SIPC.