A few charts worth discussing
“Change in grocery spending six months after GLP-1 adoption. Notably, spending on coffee, tea and energy drinks declined 4%, while water declined 2.5%. This suggests there’s also a broader traffic and industry effect at play.”
“The death of consumer-packaged goods brands is well understood.”
“Food away from home continues to take share, providing a tailwind for restaurant spending that likely outweighs the impact of GLP-1 adoption, with convenience and delivery continuing to drive share gains.”
“Multiples have followed the decline in revenue growth across the consumer-packaged goods sector, falling as growth has slowed.”
Other charts worth pointing out
U.S. household card spending by category
Spread-to-worst by credit rating
Historical S&P 500 Index earnings per share
S&P 500 Index earnings growth vs. U.S. economic growth
S&P 500 Index diverging valuations
Contribution to S&P 500 Index earnings per share growth
Reported vs. fully expensed capex impact on earnings per share
Correlation between technology and non-technology stocks
S&P 500 Index vs. Treasury Index 2-year rolling correlation vs. U.S. 10-year Treasury yield
US regulator opens markets to tokenised stock trading
The US Securities and Exchange Commission has greenlit trading in tokenised stocks in a move that is expected to push crypto companies more firmly into traditional equity markets.
Tokenised stocks are blockchain-based representations of traditional equities. Proponents say they enable holders to trade them round-the-clock, more cheaply than traditional stocks and more easily used as collateral.
The SEC’s long-awaited order comes as the proliferation of stock tokens has come under fire, particularly from companies that object to tokenised versions of their traditionally issued stocks.
Retail brokerage Robinhood offers tokenised stocks outside the US, but has faced criticism for offering tokens tied to the stocks without the approval of the issuers.
Under the SEC’s so-called innovation exemption, companies such as Robinhood which offer tokenised stocks in the US must “provide written notice and an opportunity to object” to the company whose stock they want to tokenise.
The blockchain-based tokens must also give investors “the same rights and privileges” as traditional stocks, such as voting rights, and trading in them must stop at the same time as any stoppage on a traditional venue.
Issuers including Robinhood and Kraken owner Payward will have to change the models they currently offer to investors outside the US in order to meet the SEC’s requirements, as they currently do not ask issuers for permission to list their shares and users do not have direct voting rights.
The tokens instead essentially act as derivatives that track a company’s share price. The firms can still continue to offer the derivative model to investors outside of the US.
The SEC’s innovation exemption comes as the agency’s role in setting rules for the crypto industry is expected to grow in lieu of US laws. A landmark US crypto bill, known as the Clarity Act, failed to advance in the Senate this week, as Democrats insisted on stronger limits on Donald Trump’s ability to profit from the digital assets industry.
The order gives venues that want to offer tokenised stock trading a five-year exemption from many rules that apply to platforms such as Nasdaq and the New York Stock Exchange, as the regulator tries to boost digital markets.
Crypto companies are fiercely trying to compete with longstanding exchanges and brokerages by giving customers access to tokenised stocks. They largely believe that stocks, bonds, commodities and other assets will all eventually be traded on the blockchain 24/7.
Some crypto firms have argued against Robinhood’s derivative model and believe corporate issuers must be involved in the process.
Before the SEC’s latest rule, few companies had undertaken direct issuance. Blockchain technology company Figure Technology Solutions issued its own equity on to the blockchain in February.
Tokenisation firm Ondo Finance’s Matthieu de Vergnes argues that derivatives tied to equities already exist, such as equity-linked notes or American depositary receipts, which offer US investors exposure to foreign stocks.
This week’s fun finds
Some 600 years ago, members of the pre-Inca Chimú civilization buried more than three dozen people in a mausoleum near modern-day Trujillo, Peru. The dead were interred alongside a rich array of grave goods, including metal weapons, copper and gold artifacts, ornate jewelry, and colorful textiles—suggesting that they were high-status individuals, perhaps even royalty.
The mausoleum remained largely intact until this year, when excavations uncovered its entrance beneath layers of sand, soil and stone at Chan Chan, a UNESCO World Heritage Site that was once the Chimú capital. The tomb dates to during or just before the Inca conquest of the region in the mid-15th century, making its survival, untouched by colonial and contemporary looters alike, even more impressive.
As lead archaeologist Jorge Meneses tells BBC News, the find marks “the first time that Peruvian archaeologists have been able to come across an almost intact [funerary] platform, with unaltered contents, a platform that was designed for an elite individual, whose main chamber has remained sealed for almost 600 years.”
