Busy couple of weeks on results front

[Adam Kay]

Coreweave CEO says demand for AI racks is insatiable with the demand/supply imbalance getting bigger.

As we have said before, supply has been the constraint and will remain same. In the 'years' ahead it will probably switch to Power constraint. We have looked at power infrastructure companies in the past, discussed it internally and here. My view was that power being a commodity is relatively low margin vs high capital cost(to scale it). What I didn't consider is the massive pull fwd the market gamblers would attribute to various stocks and bid them up to a bubbly froth. Utilities companies should not trade at multiples of 50+ and only we aint playing.

[Adam Kay]

At Jackson Hole, Powell noted that a shifting balance of risks “may require adjusting our policy stance,” indicating potential readiness to lower the central bank’s policy rate if warranted.“Inflation risks are skewed upwards, while employment risks are downwards — a complex scenario,” Powell added.Consequently, the likelihood of a September rate cut increased, rising from ~71% before the speech to ~93% afterwards.

[2BToo]

.... all of which made for a nice jump in the markets. Which is most welcome as they seem to have been stagnating of late.

(And an aside: the scrolling to the bottom of a long thread like this is a bit faff-y. Could it be split into pages, a la PH? Perhaps I should suggest this elsewhere.)

[Adam Kay]

Hi O,

It's not stagnation more consolidation. Look where we have come from.

22/April to 22 July > 40% rally in Tech/Growth
22 July to 222 August has been flat.

The rally isn't typical however the pause is. Many reasons for it.

Market awaits new information
The buyers that pushed prices higher step back
Stock holders take profit
We have given back 2-3% on the FX rate

The usual psychologies weigh on our minds as rapid gains prevail it's too easy to expect them daily/weekly. It doesn't work like that. There is also (still) a lot of DT noise we have to wade through.

Cheers

Adam

[2BToo]

Thanks Adam. Always helpful stuff.

Edited to add: there dashboard numbers haven't gone up as much as I'd expect, given the market bump yesterday. Why is that? (Telling me that my expectations are too high is a perfectly valid response.)

[dingg]

Exchange rate, usd weaker v gbp by 0.8% on expected rate cut following Jackson Hole commentary

[PorkInsider]

@dingg said in Busy couple of weeks on results front:

Exchange rate, usd weaker v gbp by 0.8% on expected rate cut following Jackson Hole commentary

Also, I believe (I'm sure I'll be corrected if wrong) that the daily update of values we see is not from close of US markets, but some time before that, so if they rose, or fell, later in the session we may not see that next day?

[Adam Kay]

All prices are taken after the US close. FX is taken at 23.30GMT. With trackers(Global) some of their holdings are on exchanges which have not closed/opened at that time so these specific holdings will not be that days close.

[Ronski]

IIRC correctly it was 3pm UK time, but that may have changed.

The real reason for the slowdown is because I'm approaching another milestone in my pension pot, and as always it stubbornly doesn't want to go over it

[Adam Kay]

Hi Ron, There isn't a snap shot take at 3pm UK. I think it's all taken 23.30 GMT(for us) and by doing so it captures the UK close and the US close. The broker-dealer probably does take prices before then as they will supply data to many other asset managers and some of them may report(they do) at 10.30pm uk time (t0) particularly if they have a large exposure to UK stocks.

I hope this helps

[PM3]

"think" ?

[Ronski]

Thanks for the confirmation Adam, I seem to remember the 3pm bit was a long time ago, and I thought it may have changed.

[Adam Kay]

3pm(UK) is 'around' the time that the days buying and selling is conducted.