😍 The market recovers

the new iPhone is coming

Author

Michael Wight
August 08, 2023

Morning Download from Invincible Money 

Personal finance + economics + markets


Good morning investors! Monday brought green surprises, proving that the stock market on Mondays will ‘not always’ follow the prevailing trend from the previous Friday.

Most sectors closed green with no major news.

🎤 Podcast? Over 75% of readers said they’d also like this newsletter in podcast form, so I’ve started working on it. Look for an announcement soon.

Today we cover:

  • Stocks rebound after a lull

  • What we know about the iPhone 15 launch date

  • Why you should avoid private student loans

📊 Economy 

Australia wants China to remove all trade restrictions

Australia wants China to remove wine import restrictions after the latter recently surprised analysts by announcing a 80.5% drop in anti-dumping tariffs and countervailing duties on Australian barley.

The Chinese Commerce Ministry cited “changes in the Chinese market” to justify the decision to remove restrictions over three years after they were imposed.

China is Australia's largest trade partner and despite differences on political fronts, the two countries have maintained strong trade ties. Now with tariffs gone, Australia can once again focus on strengthening the bond with China and stop looking for partners in other countries.

Australia once exported barley worth about 1.5 billion Australian dollars ($988.1 million) to China and expects to reach this number again and boost its falling economy. The country has been struggling for the last few months and also expects its unemployment rate to rise.

📰 News

iPhone 15 set for a September release

The new iPhone is set to release in the third week of September, according to a Bloomberg report.

The debut will follow a massive launch event in mid-September (12 or 13), adds the report, which predicts the launch date as September 22nd.

Experts believe that the new phone can help boost Apple stock, which has fallen over 8.85% after the company announced a 2% fall in iPhone sales.

Covid-related issues impacted the current generation iPhone and there are hopes that the new device, which comes with some major upgrades, will help the company solidify its position.

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📈 Stocks

S&P 500 4,518 (0.90%)
DJIA 35,473 (1.16%)
NASDAQ 15.403 (0.87%)
VIX 15.77 (-7.78%)
* Prices as of Aug 8th, 12:20 AM UTC

Stocks recover as the market prepares for more earning reports

The stock market snapped its four-day losing streak as the Dow Jones Industrial Average rose more than 400 points on Monday. Even without any big news, Monday turned out to be the best day for the index since June 15.

Earnings continued to be positive with about four-fifths of the 85% of companies that have posted their quarterly results so far giving strong numbers.

“Markets are back on to a risk-on mode,” said Chris Zaccarelli, chief investment officer of the Independent Advisor Alliance. “It’s been a better-than-expected earnings season, and so I think that’s why the market’s had such staying power.”

Some big names, however, are yet to report, including Disney (9-Aug-2023), and Alibaba (10-Aug-2023). Later, however, investors will focus on July consumer and producer price index data.

Major Movers:

🔐 Crypto

Bitcoin $29,159 (0.40%)
Ethereum $1,823 (-0.20%)
Total market cap $1.16 (-0.17%)
* Prices as of Aug 8th, 12:20 AM UTC

PayPal goes big, launches dollar-backed stablecoin

PayPal has become the first major U.S. financial institution to launch a dollar-backed stablecoin, a decision that helped the stock jump 2.66% on Monday.

Issued by Paxos Trust Co, this new change will give users the option to transfer “the stablecoin between compatible external wallets and PayPal,” while also enjoying the ability to fund purchases using PayPal USD.

Users, however, will not immediately have the option to buy, sell, convert, or fund purchases using the coin as these features will be rolled out in a few days.

💵 Personal Finance

Why private student loans may not be suitable for you

With most college bills due this month, some students or parents may be thinking of applying for private student loans. However, it might be a good idea to rethink your strategy because these loans can end up being very expensive and difficult to manage.

Consider private loans only if you have already maxed out your federal aid. Most students can borrow up to $12,5000 in an academic year, which may not be enough to fund their education.

Federal student loans are not only affordable but offer other benefits as well, including attractive forgiveness programs and the ability to pause interest. Sadly, private loans do not come with these features.

Failing to pay a private loan can be risky as it gives lenders the right to sue for recovery through wage garnishment and asset seizure. Also, it’s not only for the borrower but also for the cosigner, making private loans very risky.

Furthermore, you need to look at the interest rate. Consider going for a loan that comes with a fixed rate even if the variable rate looks more attractive as we are in a rising-rate environment and the rate may end up going higher than you expect. Most private lenders offer a rate between 4% and 15%, usually higher than the 5.5% charged by federal agencies.

Consider watching this video to know more about how student loans can impact lives:

How much to borrow?

This question can be hard to answer; however, most experts believe that you should not borrow more than your expected starting income after school.

💰 Be a Better Investor

“Good advice is never as helpful as an interest-free loan.”

Mason Cooley

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👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.