🐂 End of an Era

Market News 1/9/24

Markets

Yesterday, the stock market experienced a significant surge, bouncing back from the challenges of the previous week to mark the first substantial rally of 2024. The Nasdaq saw a notable increase of 2.2%, with tech stocks showing strength just as the Consumer Electronics Show (CES) kicked off today. However, this positive trend did not apply to Boeing, as the company faced an 8% drop in its stock value following the grounding of its 737 Max 9 planes in the aftermath of the Alaska Airlines incident.

Sports

Tiger Woods decides to leave Nike 27 years later

Yesterday, Tiger Woods made the announcement on X that he is concluding his historic 27-year partnership with Nike, signaling the end of one of golf's most iconic images – Woods donning a red Nike polo on the Sunday of a PGA Tour event.

In a deal that stood the test of time, Nike signed Woods in 1996, the year he turned professional at the age of 20, in a groundbreaking $40 million contract, which was then the largest golf endorsement deal. Throughout his illustrious career, the signature Nike swoosh remained a constant, and Woods amassed an estimated $500 million in earnings over the nearly three decades of this partnership.

However, all good things must come to an end. Speculation within the sports world had anticipated that Woods would part ways with Nike when the deal concluded at the end of 2023. Since Nike ceased its golf equipment division in 2016, Woods has been using clubs and balls from other brands. Recently, he was seen on the course not in Nikes but in FootJoy shoes, citing their greater stability as he continues to recover from an injury sustained in a 2021 car accident.

Looking ahead, Woods is expected to participate in the Genesis Invitational next month, marking his first official PGA Tour event in almost a year as he continues his recovery. However, when it comes to brand deals, the future is uncertain. Speculation suggests that Woods might venture into starting a brand within the golf company TaylorMade or create an entirely new brand.

Some in the golf community speculated that Woods might follow in the footsteps of tennis star Roger Federer and sign a deal with On Running, the Swiss shoe brand. Federer parted ways with Nike in 2018 to join Uniqlo and invested in On Running, resulting in a $300 million payday when the company went public three years later. However, these rumors were debunked by the company's chief executive yesterday.

Notably, Woods isn't the only one departing from Nike, as Jason Day left the brand for Malbon just last week. While Nike still has other prominent golfers sporting the swoosh logo, its long-term presence in the sport remains uncertain.

Tech

The Peregrine moon lander suffered a propulsion system failure

Due to a malfunction, the spacecraft, constructed by the private firm Astrobotic Technology and funded by NASA, is unlikely to reach the moon as originally planned. Astrobotic announced on X that a technical anomaly, causing a "critical loss of propellant," has necessitated a shift in the mission objective. Peregrine, initially intended to be the first American spacecraft to land on the lunar surface in over 50 years, faced this setback. This incident prompts questions about NASA's strategy of financing startups for lunar experiments instead of deploying its spacecraft, particularly in the lead-up to the crewed Artemis mission scheduled for November.

Art

Why a Russian Oligarch is suing Sotheby’s

Russian billionaire Dmitry Rybolovlev, claiming he was misled by Sotheby's into overpaying $1+ billion for art treasures, is currently in a Manhattan court for a legal battle. The Monaco-based fertilizer tycoon accuses Sotheby's of collaborating with his art advisor, Yves Bouvier, in artificially inflating the prices of artworks, including a Modigliani sculpture and paintings by da Vinci, Magritte, and Klimt.

This trial provides a rare glimpse into the opaque and unregulated private art market. Rybolovlev spent $2 billion acquiring masterpieces between 2002 and 2014, with some deals brokered by Sotheby's. However, he later discovered that 38 artworks actually belonged to Bouvier, who falsely negotiated prices with nonexistent sellers. The legal dispute covered various jurisdictions, but Rybolovlev and Bouvier recently settled out of court, with no criminal wrongdoing found.

Sotheby's, now facing the legal challenge, asserts there is "zero evidence" that the auction house was aware of Bouvier's deceptive practices in dealing with Rybolovlev.

Real Estate

This is how it feels to live in Buffalo right now

Bills Mafia has more reasons to celebrate as Buffalo, New York, is anticipated to become the top housing market in the US in 2024, according to Zillow. This is attributed to the city's affordable home prices and robust employment rates. If the enthusiastic welcome for the Buffalo Bills upon their AFC East title win isn't enough to spark your interest, perhaps the following information will:

Zillow reports that the average home cost in Buffalo is approximately $248,000, significantly below the national average of around $347,000. On average, Buffalonians pay about $1,800 monthly for their mortgage or $1,300 in rent.

Buffalo also stands out with the highest rate of new jobs per new home among the 50 largest cities in the US, as per Zillow's metrics, which factor into the expected housing demand.

The city is gearing up for potential growth in the tech sector, aptly nicknamed "Silicon Billy." In October, the Biden administration designated Buffalo as a "tech hub" for semiconductor manufacturing, making it eligible for substantial government funding through the CHIPS Act.

Other notable housing markets in the forecast include Cincinnati, Columbus, and Indianapolis. Zillow predicts a promising year for real estate in the South, Midwest, and Great Lakes region, leaving other regions comparatively less favorable.

Aviation

The fallout from Alaska Airlines Flight 1282 continued

Several days after a panel malfunctioned midair on the Boeing 737 Max 9, causing hundreds of flights to be grounded, the FAA instructed US airlines with Max 9s, including Alaska and United, to conduct fleet inspections. During these inspections, both airlines reported discovering loose bolts on plug doors. Simultaneously, federal officials disclosed that the aircraft involved in the incident had limitations on flying long distances over water due to a known pressurization issue, although it may not have been connected to the door plug incident. Unfortunately, the cockpit voice recorder, crucial for investigators in understanding how the panel detached, was overwritten because it was not retrieved within the critical two-hour timeframe. As the situation unfolds, here are additional details for passengers to be aware of regarding the Boeing 737 Max 9.

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