Pencils down, it’s time for lunch. Here’s what you missed this morning:

• 🟥 | Market Snapshot: The S&P 500 and Nasdaq Composite fell this morning as investors continue to rotate out of mega-cap tech stocks. The S&P 500 fell more than 1%, and the Nasdaq fell more than 2%.

• 🏠 | In focus: The Commerce Department reported data this morning showing a significant rebound in new residential construction in the month of June. The report showed housing starts popped up 3% to an annual rate of 1.35 million in June.

• 💾 | Noteworthy:The Biden administration is considering imposing a measure called the Foreign Direct Product Rule, which would allow the US to impose controls on foreign-made products that use even the tiniest amount of American tech. This is intended to reign in China’s chip industry, and the restrictions could hit companies like Tokyo Electron and ASML.

• 🌍 | The Midday Trade: The Amazon of Africa. Scroll down for more.

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STREET STATS

MORNING MOVERS

Nvidia, Five Below, & US Bancorp

NVDA: Shares of Nvidia tumbled this morning as investors rotate out of tech stocks, and some have fears over the safety of its supply chain (Barron’s)

FIVE: Five Below’s stock plummeted after its CEO resigned, and the retailer lowered its Q2 guidance (Investopedia)

JBHT: JB Hunt saw its shares tank after reporting Q2 results that missed Wall Street estimates, pointing to a weak manufacturing economy (Barron’s)

VFC: Shares of VF Corporation popped after EssilorLuxottica agreed to acquire its Supreme Brand for $1.5 billion in cash (VF)

USB: US Bancorp’s stock popped after reporting Q2 earnings that topped consensus estimates, and its net interest income improved (SA)

TOP CALLS

Ur-Energy: HC Wainwright & Co. Maintains Buy on Ur-Energy, Lowers Price Target to $3.2 (Trade It)

Charles Schwab: Deutsche Bank Maintains Buy on Charles Schwab, Lowers Price Target to $79 (Trade It)

State Street: Deutsche Bank Maintains Hold on State Street, Raises Price Target to $80 (Trade It)

Dycom Industries: Wells Fargo Maintains Overweight on Dycom Industries, Raises Price Target to $200 (Trade It)

JB Hunt: BMO Capital Maintains Outperform on JB Hunt Transport Servs, Raises Price Target to $195 (Trade It)

PNC: Evercore ISI Group Maintains Outperform on PNC Finl Servs Gr, Raises Price Target to $200 (Trade It)

THE MIDDAY TRADE

The Amazon of Africa

Best Idea Ever

According to Musketeer Capital’s Josh Koren, Jumia Technologies (JMIA) could see its stock price increase ten times over in the near future. In fact, Koren said this might be the greatest stock idea he has ever had, and it is currently the largest position in his fund.

Jumia is a pan-African e-commerce company that some have described as the “Amazon of Africa.” It currently operates its e-commerce platform in 10 countries throughout the continent.

Improving Fundamentals

The stock IPO’d in 2019 and has been volatile ever since. It debuted at $14.50 per share and hit its all-time high of $62 in 2021. However, it was trading below $3 by October 2023.

However, its recent quarterly earnings showed that it has cut its losses significantly and has positive operational cash flow for the first time in its history. Additionally, its margins are showing improvement.

Outside Investments

According to Koren, Jumia is currently valued at $1.2 billion but could hit $10 billion within two or three years and $50 billion in a decade. Koren also believes that the e-commerce industry in Africa as a whole is extraordinarily undervalued.

That being said, Jumia has had a hard time remaining profitable. African markets are hampered by infrastructure and currency challenges. However, there has been a huge uptick in outside investments into African infrastructure and internet, and Jumia could be in a great position to benefit.

TOGETHER WITH DATALIGN ADVISORY

Election-Proof Your Finances

Navigate the uncertain waters of the upcoming election with confidence. Our expert-driven questionnaire, backed by years of financial expertise, delivers personalized insights tailored to your unique goals.

Secure your financial future today at datalignadvisory.com!

SURVEY THE STREET

In May, Disney reported that its streaming business turned a profit, posting a $47 million operating income compared to a $587 million loss a year earlier.

Disney is hoping to increase those gains. A new report from the Wall Street Journal details how the company is adding features, such as a more personalized algorithm to power content recommendations, to make Disney’s streaming service “as addictive as Netflix.”

Plus, Yesterday’s Poll + Results:

Will Chinese leaders find solutions to the nation's economic issues, or is the nation headed for a downturn?

🟨🟨🟨🟨⬜️⬜️ 📈 China will regain its growth trajectory

🟩🟩🟩🟩🟩🟩📉 China will face an economic downturn