📱 Samsung beats Apple

and oil to cross $100?

Good morning investors! Stocks retreated on Monday recording one of the worst days of the year as investors wait for Israel’s response to Iran’s attack.

Fun fact: In 1792, 24 stockbrokers and merchants signed the Buttonwood Agreement under a buttonwood tree on Wall Street in New York City. This agreement marked the founding of what would later become the New York Stock Exchange. The buttonwood tree, now long gone, served as an early meeting place for traders.

Today we cover:

  • War may send oil above $100.

  • Goldman Sachs earnings

  • Apple is in trouble.

📊 Economy and News 

Oil to go above $100?

Market analysts are suggesting that oil prices could surge beyond $100 per barrel following an aerial attack by Iran on Israel, sparking concerns of a regional conflict.

Iran, possessing significant oil reserves, could face disruptions in its ability to supply global markets, potentially leading to further price increases.

Despite these developments, there was no immediate impact on Monday, as prices actually eased yesterday. It seems that traders are adopting a wait-and-see approach, anticipating Israel's next moves.

In contrast, spot gold saw a 0.3% increase, reaching $2,349 per ounce on Monday. The precious metal had reached an all-time high of $2,431 per ounce on Friday, driven by fears of a potential Iranian attack on Israel. Bullion has risen nearly 14% since the beginning of the year.

Global hits:

  • Biden administration agrees to provide $6.4 billion to Samsung for making computer chips in Texas.

  • China accounted for two-thirds of new global coal plant capacity in 2023.

  • Trump Media closes down more than 18% after filing plans to issue more DJT stock.

📈 Stocks

S&P 500 5,061.82 (-1.20%)
DJIA 37,735.11 (-0.65%)
NASDAQ 17,706.83 (-1.65%)
BRENT CRUDE 90.10 (-0.39%)
* Prices as of Apr 16th, 12:20 AM UTC

Goldman Sachs tops first-quarter estimates

Goldman Sachs on Monday posted first-quarter profit and revenue that topped analysts’ expectations, fueled by a surge in trading and investment banking revenue.

Here’s what the company reported:

  • Earnings: $11.58 per share, vs. $8.56 expected, according to LSEG

  • Revenue: $14.21 billion, vs. $12.92 billion expected

The bank reported a 28% increase in profit to $4.13 billion, or $11.58 per share, compared to the same period last year, driven by a rebound in capital markets activities. Revenue also saw a significant rise, increasing by 16% to $14.21 billion, surpassing analysts’ estimates by more than $1 billion.

Unlike its more diversified competitors, Goldman Sachs generates most of its revenue from Wall Street activities. This characteristic can lead to exceptional returns during prosperous market conditions and underperformance when markets are challenging.

Following a shift away from retail banking, Goldman Sachs has focused on expanding its asset and wealth management division for growth opportunities.

However, the asset and wealth management division was the only segment at Goldman Sachs that did not exceed expectations for the quarter. Revenue in this division increased by 18% to $3.79 billion, in line with the StreetAccount estimate, driven by higher private banking and lending revenue, increased private equity stakes, and rising management fees.

Apple gets bitten: In the first quarter, Apple's shipments dropped to 50.1 million units, a decrease of 9.6% compared to 55.4 million units shipped in the same period the previous year.

Apple experienced the most significant year-on-year decline among the top five smartphone brands.

Samsung reclaimed the top position in the first quarter, regaining the lead from Apple last year, with a 20.8% market share and nearly identical unit shipments to the previous year, totaling 60.1 million. Its market share was 22.5% in the first quarter of 2023.

Xiaomi is making a strong comeback following significant declines over the past two years, while Transsion is establishing itself as a stable presence in the top five, showing aggressive growth in international markets.

Reminder: Tesla will lay off more than 10% of global workforce.

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That means it’s a big opportunity for investors. Retrieve is a Software-as-a-Service company that operates on a recurring revenue model. With 34M+ hospital discharges annually at $25 per discharge, it represents millions in revenue for the company. 

But what makes Retrieve so confident that hospitals will want their product?

  1. Hospitals earn more revenue: Retrieve identifies comorbidities which can lead to bigger insurance reimbursements. 

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🔐 Crypto

Bitcoin $63,413 (-3.59%)
Ethereum $3,122 (-0.73%)
Total market cap $2.31T (-2.94%)
* Prices as of Apr 16th, 12:20 AM UTC

Hong Kong approves spot BTC and Ether ETFs

Hong Kong regulators on Monday approved the launch of spot Bitcoin and Ether exchange-traded funds (ETFs).

ChinaAMC, Harvest Global and Bosera International are among those that have been given the green light to issue ETFs.

Crypto trading is effectively banned in mainland China after a massive crackdown on the sector in 2021, however, Hong Kong has slowly been trying to make itself a regulated crypto hub.

Despite the news, BTC has been struggling to maintain the $64,000 mark.

💵 Personal Finance

Are stock portfolios going out of fashion?

Things are changing quickly. Back in the day, investing in stocks and bonds was considered the winning formula. However, that isn’t the case anymore now that we have better (and more) options to choose from.

Longer-term Treasury yields have hit their highest levels in 16 years, causing their value to plummet, and stocks are expensive as well. It is time for investors to look elsewhere.

Is the stock market a bad choice? Not really, the S&P 500 Index is still offering great results. But, most experts agree that it has peaked. The chart below highlights the last few years:

It stands at 6.73% so far for 2023 and Also, experts now expects the S&P 500 (.SPX) to hit 6.000 with in the next 12 months due to expected cuts.

Stocks versus real estate: From March 1992 to March 2022, the U.S. average growth rate was 5.3%. The S&P 500 returned 9.65% annualized from the beginning of 1992 to the same period in 2022.

The inflation-adjusted appreciation on the Dow Jones Industrial Average over the same 30-year period was 5.565% per year, and that's just for asset value.

If you assume that dividends are reinvested, the returns are better than 8.044%. Over time, stocks outperformed real estate.

Here are some great alternative options :

Real Estate Investment Trusts

REITs invest in a range of real estate, including housing, commercial buildings, hotels and warehouses, and then distribute the rental proceeds to the owners. This is a clever way of benefitting from the real estate industry without investing millions.

Comparison: Over a 25 year period, the index returned 9.05% compared to 7.97% for the S&P 500 and 7.41% for the Russell 2000.

Gold

Gold can be a great investment option in today’s environment. You can invest in gold bullion, gold coins, gold mining companies, gold futures contracts and mutual funds that invest in gold. You may, however, need a safe place to store the investment like a safe deposit box at a bank if you choose physical gold.

Comparison: The S&P 500 Index of stocks had a 10.43% average annual total return between 1970 and 2022, according to an analysis by Securian Asset Management. Gold had a 7.7% return over the same period.

Commodities Futures

Commodities are risky but very rewarding. Options include grain, corn, and cotton. However, you have to be careful because external conditions can impact commodity prices.

Comparison: Commodities can be very rewarding but also risky. Lithium, for example, offered 72.49% returns in 2022, in comparison crude oil offered 6.71% returns, and copper offered -14.13% returns.

Don’t give up on stocks altogether. They should remain a part of your portfolio but keep your expectations lower because we may not again see the numbers seen in 2019 to 2021.

💰 Be a Better Investor

"The stock market is filled with individuals who know the price of everything, but the value of nothing."

Philip Fisher

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

Disclosure: This is a paid advertisement for Retrieve Medical’s Regulation CF Offering. Please read the offering circular at https://invest.retrievemedical.com/.

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