First Horizon and TD Bank have called off a $13 billion deal that would have formed America’s sixth-largest bank due to a long regulatory
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2023-05-05 | Sign Up | View Online
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Market Snapshot 📷
S&P 500 4,061.22 -0.72%
Nasdaq 11,966.40 -0.49%
Dow 33,127.74 -0.86%
10-Year 3.369% -0.034%
Oil 68.54 -0.09%
Gold 2,059.10 +1.08%

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Markets & Economy
Investors are waking up to America’s debt dysfunction (4 min read)

Investors are starting to worry that the US could default as the deadline to raise the debt-ceiling limit is getting near. The credit default swap prices have jumped above 1.65%, suggesting that investors fear a small, but rising, chance of default. US short-term treasury yields are also higher than corporate bonds, which implies that Amercian’s C-suite is now considered safer than Uncle Sam. But in reality, the chance of default is very low as Congress has a history of flirting with disaster before cutting a last-minute deal.
Gold flirts with all-time highs as banking concerns deepen (2 min read)

Gold continued its upward trajectory as investors sought the safe-haven asset amid concerns over US banking. The price of gold was inching towards the record high of $2,072.49 on Thursday morning. Another driver for the rally was the expectations of a pause in US rate hikes and economic uncertainty, with lower rates boosting demand for zero-yield bullion. However, the higher gold price has resulted in a decrease in demand for gold jewelry in top Asia retail stores.
Business & Stocks
First Horizon stock tumbles after TD Bank merger collapses (3 min read)

First Horizon and TD Bank have called off a $13 billion deal that would have formed America’s sixth-largest bank due to a long regulatory process. First Horizon stock has already plunged well below TD’s takeover price amid the banking crisis and it fell another 40% on Thursday after the news. Other regional bank stocks have also tumbled in recent days since the third bank, First Republic, collapsed on Monday. Some speculate PacWest will be the next to fall as its value was cut in half after the bank confirmed it’s looking for a financial lifeline.
J&J’s consumer-health spinoff Kenvue jumps 20% in public market debut (4 min read)

Johnson & Johnson's consumer health spinoff, Kenvue, had a successful market debut on the NYSE, jumping more than 20% on the first day. It raised about $3.8 billion and is the largest IPO since EV maker Rivian went public in November 2021. Kenvue owns popular consumer brands such as Band-Aid, Tylenol, Listerine, Neutrogena, Aveeno, and J&J’s baby powder. The company is already profitable according to the preliminary prospectus and expects to pay a quarterly cash dividend of $0.20 per share starting in Q3.
Funds & ETFs
Vanguard Funds: VOO vs VFIAX Comparison Guide (6 min read)

VOO and VFIAX are Vanguard’s fund that tracks the S&P 500 index, but VOO is an ETF, and VFIAX is a mutual fund. Despite VOO’s expense being slightly lower than VFIAX, their performance is identical as measured by NAV. The main considerations between the two depend on the investor’s minimum investments, trading flexibility, and type of brokerage accounts. More on their comparisons are available in the article.
ChatGPT ‘portfolio’ outperforms leading UK funds (2 min read)

A theoretical fund created by ChatGPT has outperformed some of the UK's leading investment funds, according to an experiment by personal finance comparison site The portfolio of 38 stocks created by ChatGPT rose by 4.9% in the eight weeks since its creation, compared with an average loss of 0.8% for the 10 most popular funds on UK platform Interactive Investor. Some 19% of UK adults surveyed by said they would consider getting financial advice from ChatGPT, while 8% said they had already taken financial advice from the chatbot.
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