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Nasdaq entered correction territory, Japan stocks entered a bear market, the yield curve almost un-inverted, economic data triggered a recession rule, and a junior IB analyst won gold at the Olympics 💪🇺🇸

Wharton Online & Wall Street Prep is back with their flagship Private Equity Certificate Program. Learn more below and save up to $500 with early enrollment!

Let’s dive in.

Before The Bell

Markets

• US stocks and yields plunged after a weak July jobs report ignited recession fears

  • Nasdaq's 10% correction is its first since January 2022

  • Russell 2000 lost 6.7% in its worst week in over a year

  • VIX volatility index hit its highest since March 2023

  • Rate futures now reflect a 70% chance of a 50 bps rate cut in September, up from 22% before the jobs report

• Japan stocks entered bear territory, erasing their entire 25% YTD rally

• Europe's Stoxx 600 hit a five-month low

• US 2Y-10Y yield curve inversion is at -9 bps, the lowest since inverting in 2022

  • US 10Y yield hit its lowest since December 

  • US 2Y yield plummeted ~30 bps to its lowest since May 2023 

• China 10Y and 30Y yields fell to a record low 2.13% and 2.37% respectively

• Commodity index tumbled to its lowest since March as traders exit 

• Oil fell to an eight-month low

• US dollar hit a four-month low

• Yen strengthened to an eight-month high versus the dollar 

• Bitcoin dropped below $57k in its worst week since FTX collapsed 

Earnings

• Berkshire Hathaway reported record operating profit thanks to its GEICO unit, while dumping $75B worth of stock including half its Apple stake to amass a record $277B cash pile (CNBC) 

• ExxonMobil beat Q2 EPS and revenue estimates with its second-highest results in a decade on record production in Guyana and the Permian (CNBC) 

• Chevron missed Q2 EPS estimates due to lower refining margins and announced plans to move its HQ from California to Texas (CNBC) 

• What we're watching this week:  

  • Today: Palantir

  • Tuesday: Uber, Airbnb, Reddit, Amgen

  • Wednesday: Walt Disney, Shopify, Robinhood, CVS 

  • Thursday: Eli Lilly

• Full calendar here

Headline Roundup

• 2024's most popular trades are unraveling (WSJ)

• US unemployment jumped to a three-year high (CNBC)

• Goldman lifted US recession risk odds from 15% to 25% (BBG)

• Volatility-linked funds' stock dumping is exacerbating the selloff (RT)

• Hedge funds added net short equity bets for a third-straight week (RT)

• Investor appetite for multi-strat hedge funds declined (RT)

• Blackstone and peers deployed $160B in Q2, ahead of deal flow revival hopes (FT)

• Traders are continuing to unwind emerging market carry trades (BBG)

• Big Tech is failing to convince that AI is paying off (BBG)

• Layoffs are piling up in US and Canada (RT)

• UK chancellor will visit New York to court investors (FT)

• Saudi Arabia raised Asia oil prices in sign of faith in demand (BBG)

• World's biggest lithium producer is seeking help to compete with China (FT)

• US defense secretary withdrew the plea deal for 9/11 masterminds (AP)

• A junior IB analyst won gold at the Olympics (GRN)

A Message From Wall Street Prep

Last chance to save $500 on the Private Equity Certificate Program!

The early enrollment deadline for the Private Equity Certificate Program is fast approaching.

This comprehensive 8-week online course, created by Wharton Online and Wall Street Prep, is designed for individuals looking to enhance their private equity knowledge or those aspiring to enter the industry.

Beyond learning the technical skills from the top instructors on Wall Street, you’ll hear from top industry executives like David Rubenstein, co-founder of The Carlyle Group, and Martin Brand, Sr. Managing Director at Blackstone. 

While the course ends after 8 weeks, you can continue to grow your network through exclusive networking opportunities, LinkedIn groups, and targeted recruitment events with leading firms. 

Don't miss your chance to start your journey into private equity. Enroll by August 12th and use code LITQUIDITY to save $500. Click below to get details about the curriculum, speakers, and exclusive networking opportunities!

Deal Flow

M&A / Investments

• Food giant Mars is exploring an acquisition of $20B-listed snack maker Kellanova (RT) 

• Asset manager Neuberger Berman is nearing a deal to buy a minority stake in  international-school operator Nord Anglia at a $15B valuation, including debt (WSJ) 

• Dun & Bradstreet, a $5.5B-listed data and analytics provider, is exploring a sale (RT) 

• Spanish energy firm Iberdrola agreed to acquire an 88% stake in grid operator Electricity North-West from a consortium for $2.7B (BBG)

• $2.5B-listed payments processor Flywire is exploring a sale after attracting takeover interest (RT) 

• GDS Holdings is seeking a $1B investment for its non-China data center operator GDS International (BBG) 

• Carlsberg will acquire the remaining 33% it doesn't already own in its Carlsberg South Asia unit for $744M (BBG) 

• Japan's Mitsubishi UFJ will acquire an 8% stake in Globe Telecom's Philippine fintech GCash for $393M at a $5B valuation (BBG) 

• Genetic testing firm 23andMe rejected CEO Anne Wojcicki's $200M take-private offer (RT)

• Energy engineering firm McDermott International is weighing a sale for its storage and tank business (BBG) 

• Energy trader Hartree Partners agreed to buy the commodities business of ED&F Man (BBG)

VC

• Bilt Rewards, a loyalty program for renters, raised a $150M round led by OTPP (BW)

• Contextual AI, a startup building customized language models for businesses, raised an $80M Series A led by Greycroft (FN)

IPO / Direct Listings / Issuances / Block Trades

• SoftBank and South Korea's Naver plan to sell down their stake in Japan’s Line app LY through a $1B tender offer (BBG) 

• Self-driving truck startup Aurora Innovation raised $483M in an FPO (TC)

• The IT services arm of LG is preparing for a Korea IPO as soon as 2025 (BBG) 

• AI chipmaker Cerebras Systems is targeting an October IPO (BBG)

• Mexican fashion retailer Grupo Axo is considering an IPO (BBG) 

Debt

• State-owned Bank Rakyat Indonesia is marketing a $1B syndicated loan (BBG)  

• Private credit funds are in talks to lend $978M to finance a potential LBO of Australian data center operator AirTrunk (BBG) 

• US retailer J. Crew is gauging interest for a $400M term loan to refinance debt (BBG) 

• Apax Partners-backed crate supplier Tosca Services is in talks to with lenders for a new loan (BBG) 

Bankruptcy / Restructuring

• Failed SVB's ex-owner SVB Financial Group received US court approval to turn over assets to creditors and exit bankruptcy (RT) 

Fundraising

• MM investment firm Knox Lane closed its second institutional fund at $1B (PRN)

Crypto Corner

• Crypto liquidations are surging amid the stock market downturn (TB)

• Morgan Stanley plans to offer Bitcoin ETFs to wealthy clients (CNBC) 

• Coinbase expects US to be crypto-friendly regardless of elections (RT)

Exec’s Picks

• A new e-commerce company is looking for participants in a Deal Toy survey. The survey takes 2 minutes to complete, and as a reward, those who complete the survey will automatically be entered to win one of five $100 gift cards.

Financial Services Recruiting 💼

If you're currently a junior banker looking to break into the buy side, lateral to another investment bank, or consider new paths amid changing market dynamics, it's time you check out Litney Partners, a partnership between Litquidity and Whitney Partners (the oldest purely financial services executive search and consulting firm).

We aim to place strong candidates across private equity, hedge funds, venture capital, growth equity, debt funds, and investment banking.

To get started, simply head over to Litney Partners and create your profile by dropping your resume / filling out the form:

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