June 29, 2021 Sign Up

By Overheard on Wall Street

"The time used to correct poor thinking comes from the time that could be used for good thinking."

Good morning! Yesterday Facebook joined the $1 trillion market-cap club. Apple, Amazon, Microsoft, Alphabet and Facebook combined are now worth more than $8.5T, 3x the value of the Russell 2000. In one of the most honest tweets of the year, Tom Brady admitted his laser eyes (trend where Bitcoin bulls change their profile picture to laser eyes) didn't work. Since Brady got the laser eyes, Bitcoin has fallen nearly 40%. (Deflategate 2.0?)

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1. Story of the Day: Hot IPO Summer

It's turning out to be a really hot summer, and not only in the Pacific Northwest but also for the IPO market. This week alone, 17 companies are expected to go public. Many of these companies have been prepping their IPOs since last fall and believe it is a great time to pull the trigger, as the US economy recovers after the vaccination efforts.

This week is extra busy as companies try to price before quarter end (so they don't have to report another quarter's financials) and also so they can enjoy the July 4th holiday in peace. Chinese ride-hailing company, Didi, which is listing on the New York Stock Exchange, is expected to be the biggest IPO of the week (expected $4 billion raise at $60 billion valuation). Other notable names include the doughnut chain Krispy Kreme, cybersecurity company SentinelOne and Turkish e-commerce platform D-Market.

The IPO market is expected to remain hot past the July 4th weekend as well, as a slew of companies file paperwork. Yesterday, language-learning app, Duolingo got in on the action and filed to go public. Q2 2021 is expected to go down as the busiest quarter for US IPOs since 2000.

Short Squeez Takeaway: While this Hot IPO Summer may be great news for banks' profits, it for sure is not for the junior staff working on these deals. Let's pour one out for the Investment Banking analysts pulling all-nighters on multiple staffings. In some good news for these overworked souls, JPMorgan announced it's raising 1st year analyst salaries to $100k (a $15k pay bump).

2. Markets Rundown

• S&P 500 and Nasdaq both booked record closes, supported by gains in big tech and communication stocks

Movers & Shakers

• (+) Coinbase ($COIN) +10% after the rebound of cryptocurrencies over the weekend.
• (+) Etsy ($ETSY) +7% after announcing acquisition of Brazilian marketplace Elo7.
• (+) Facebook ($FB) +4% after anti-trust lawsuits against the company were thrown out by a federal judge.
• (–) Global Food Therapeutics ($GBT) -9% after JPMorgan analyst downgraded the stock from Overweight to Neutral.

3. Top Reads

4. Book of the Day: The One Thing

Gary Keller, is the founder of the largest real estate agency in the United States, Keller Williams and also a best-selling author and a successful business coach.

The premise of his book is that by focusing your energy on one thing at a time, you can live a more rewarding life by building your career, strengthening your finances, and getting in the best shape of your life.

You will learn how to cut through the clutter, overcome the overwhelmed feeling, and build momentum toward your goals.

5. Daily Visual: Core PCE Inflation

Source: Axios

6.  Daily Acumen: Success: Luck or Hard Work?

If you ask a professional hockey player how they managed to reach the NHL, they might mention their hard work and determination but they probably won't acknowledge how lucky they were to be born in January.

In most years, 40% of hockey players selected into top hockey leagues are born in the first quarter of the year, compared to just 10% in the fourth quarter; an early birthday can make you up to four times as likely to be a pro hockey player.

The reason for this disparity is because the cutoff date for kids’ hockey leagues is January 1st. Those born in the first part of the year are a little older and so on average bigger and faster than kids in their league born late in the year.

Take the last eight track and field world records: all the athletes who achieve these records are obviously world class and extremely dedicated and yet, when they achieved their world records, seven out of eight had a tailwind.

Many think it’s either skill or luck that explains success, but the truth is you need both.

7. Memes of the Day

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