MicroSectors August Newsletter

Facebook (FB) Facebook has recently been fined $5 Billion by the Federal Trade Commission in connection to allegations that Facebook was misusing user data, allowing it to be accessed by third-party companies, such as Cambridge Analytica. Despite being the largest fine ever issued by the FTC, many have argued that this is an insignificant sum of money for Facebook, and will fail to cause any real change in the long-term. This fine is seen by experts as a way to save face for the FTC, who allowed this sort of privacy breach to occur, despite regulations that should have prevented this level of data misuse.

Philips 66 (PSX) Earlier this week, Philips 66 released their Q2 earnings report, which surpassed estimated earnings per-share by over $0.30. This performance has largely been driven by strong quarters from the midstream sector, with adjusted quarterly earnings in this sector of $423 million. Additionally, reports have claimed that these earnings have been helped by strong performance by Natural Gas Liquid terminals. This performance exceeds year-on-year performance from 2018.

Tesla (TSLA) Tesla has recently launched their third foray into the energy storage sector, following up the Powerwall and Powerpack systems with the Megapack, which has utilized design elements from the large battery array Tesla has built in South Australia. The Megapack, which was announced last Monday, will be the largest system in their product suite, with the ability to hold up to three Megawatt-Hours of electricity. Furthermore, Tesla has claimed that multiple Megapacks can be connected to create a battery with a storage capacity of up to one Gigawatt-Hour. This marks a shift in focus by Tesla, which has previously reduced their energy-storage production capacity in order to allocate more resources to the manufacturing of more Model 3 cars.

Citigroup (C) Citigroup has announced plans to cut more than 100 jobs in its trading division, particularly in the fixed-income and stock-trading operations. This is reflecting an industry-wide decline in revenues that has resulted in the loss of many jobs. Citi has announced that the majority of these cuts will occur in their London operation. Furthermore, reports indicate that this is not a one-off, and that other companies are looking to take similar measures in the weeks and months ahead.

Apple (AAPL) Apple revealed during their recent quarterly earnings call that the Apple Card, the long-rumored credit card that was officially launched this past spring, will begin to accept applications this month. Unlike traditional cards, the Apple Card will not have a single 16-digit card number, with all identifying information randomly generated at the time of each transaction so as to ensure high levels of security. Furthermore, it was stated that the financial backing for the card will be provided by Goldman Sachs (GS), and the card will also function as a part of the Apple Wallet application.

July Index Performance Analysis

Source: Bloomberg




Chart of the Month

Energy Benchmark Performance since Oil bottomed to $26.21 on 2/11/2016

Source: Bloomberg



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