Thursday's Scoop: Cruising☀️

Hey friends - it’s Thursday the 13th. Close call! Celebrate tomorrow with a quiet half day - as long as you don’t work at Wells Fargo. 👀

Insiders, look out for the Weekly Scoop tomorrow.

Here’s what you need to know today to inform your work, spending, and investments…

1. Costs keep falling for businesses.

2. Layoffs jumped last week.

3. Global oil demand could peak within five years.

Unemployment Rate: 4.0%
^{Still near the lowest rate in 50+ years}

Layoffs jumped higher last week. The Labor Department reported that initial jobless claims increased to 242,000, the highest level in nine months, led by a significant increase in California. The four-week moving average also climbed to the highest since September, with certain states experiencing notable layoff increases, possibly influenced by seasonal factors like the end of the school year. This is the first week in a long time that layoffs have risen even slightly above a very low, healthy level. One week of data is not enough to raise alarms, but it’s worth paying attention to.

Inflation Rate: +3.3% (YoY), +0% (MoM)
^{Policymakers aim for 2% YoY inflation. (May CPI)}

Supplies are getting cheaper for businesses. The Labor Department’s latest Producer Price Index showed a -0.2% decline in May, up only 2.2% over the past year compared to consumer prices, up 3.3%. Material prices fell by -0.8%, while prices for wholesale services remained unchanged. Much of the decline was driven by falling energy prices. Lower business expenses have fueled higher profits as companies keep raising prices. However, consumers seem to be nearing their breaking point, and many retailers have begun discounting.

The future may include a lot of cheap oil. According to the International Energy Agency (IEA), global oil demand is projected to peak by 2029 and start declining the following year, leading to a surplus in supply as countries like the US ramp up production. The IEA's updated forecast suggests that global demand for oil from economies worldwide will plateau at 105.6 million barrels per day by 2029 before contracting in 2030 with the increasing adoption of electric vehicles and a transition to renewable energy sources.

The Market: ⬆️ +0.2%
S&P 500: 5,433.74
1Mo: +4% | 1Yr: +24% | 5Yr: +88%

The market floated higher to its fourth straight record close on Thursday as investors celebrated more signs of slowing inflation and a strong technology sector. Cloud and AI companies seem to be doing great.