Blockchain Breakthrough 🚀

Blockchain Breakthrough 🚀  SEC has opened a five-year test for tokenized U.S. stocks on blockchain networks, creating a temporary path for onchain trading while preserving shareholder rights such as voting and dividends. 

Highlights

⛓️ The SEC opened a five-year test drive for tokenized U.S. stocks on blockchain networks.

☢️ U.S. financing support put Global Atomic’s Niger uranium project in the critical-minerals spotlight.

⚡ Amazon’s data-centre generator deal sent Generac shares soaring after hours.

Transcript

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SPEAKER_01 0:00

Let's kick off with what's been shaking up Wall Street this week. We saw AI stocks take a hit, oil prices make a run, and the 10-year Treasury yield briefly soar to 5%. The Federal Reserve's rate hike threw another curveball, forcing us all to weigh higher borrowing costs against that ongoing inflation. By Thursday, some relief came as oil prices dropped and bond yields eased, which allowed stocks to recover a bit. Even with all the drama, areas outside of AI helped cushion the rough patches in the broader market.

SPEAKER_00 0:32

That fast-changing environment really underscored how quickly the mood can shift from company news to bigger economic forces. AI news got plenty of attention, but day by day it seemed like oil and treasury yields were steering the market's general direction. It's a reminder that as investors, staying nimble and informed is more important than ever.

SPEAKER_01 0:54

Switching gears to Canada, the Toronto Stock Exchange had a pretty wild ride too. Early in the week, it outperformed compared to U.S. markets, but things reversed on Tuesday and Wednesday when falling energy stocks dragged the index down. Then Thursday came around and mining stocks staged a big comeback, pushing the TSX more than 1% higher. The whole week put a spotlight on just how crucial energy and mining are for Canada, since price swings there have an outsized impact on the market overall.

SPEAKER_00 1:26

If you're investing with an eye on TSX, it's pretty clear from this week that commodities have their own rhythm, sometimes dancing to a different beat than U.S. stocks. How those resource sectors move can sway the whole index, so it's something to keep on your radar.

SPEAKER_01 1:42

By the way, if you haven't checked it out yet, Finliti has created Game of Gains, a financial literacy board game that lets you and your friends put your money decision-making skills to the test. It's a hands-on, no pressure way to see how you react to shifting markets and surprise events without any real dollars at stake. Who knows, you might discover how things like regret, FOMO, or hesitation play out in your investing style.

SPEAKER_00 2:09

It's one of my favorite ways to talk about investing with friends who want to learn but get nervous about making mistakes. And quick tip taking the FinLeadie assessment is another way to get a snapshot of your investor profile and see where your strengths and blind spots could be.

SPEAKER_01 2:25

On the crypto front, the SEC is taking a big step by allowing some platforms to offer tokenized versions of U.S. stocks on blockchains for the next five years. Investors could hold these blockchain-based stocks and keep rights like dividends and voting, but companies still get to weigh in. This is happening just after the Clarity Act didn't pass in the Senate, so instead of waiting for new laws, the CC is making moves with the powers it already has.

SPEAKER_00 2:53

The upshot? We could see blockchain tech get a little closer to mainstream stock trading, but it's a five-year experiment. It might mean new trading options or change how liquid these stocks are, but there's still a lot up in the air.

SPEAKER_01 3:08

Jumping over to emerging markets, Washington just agreed to back up to $414 million in financing for a uranium project in Niger. This boosts a Canadian mining company, Global Atomic, as it tries to get approval and sort out politics, security, and export routes. The project could bring extra investment into Niger, but there's still a heavy lift before things really get going.

SPEAKER_00 3:32

For investors, it's a reminder of how emerging markets and the appetite for minerals can mean both big opportunities and big risks. The key to success will depend on how well everything comes together on the ground in Niger.

SPEAKER_01 3:46

Now for the latest in commodities, copper prices popped 1.6% on Thursday as Chinese buyers came back, and a weaker US dollar helped buyers using other currencies snag better deals. Inventories are thin, which makes each shipment count even more. Plus, U.S. tariff talk is pulling copper into the states, which is tightening supplies elsewhere. And after an accident in a South Korean zinc smelter, zinc prices are up too.

SPEAKER_00 4:12

It really shows how quickly prices can swing when demand shoots up or supplies take a hit. For mining companies, these price moves spell new opportunities, but they're also a reminder of how unpredictable metals markets can be.

SPEAKER_01 4:27

Let's touch on meme stocks for a second. Amazon made headlines by scoring the right to buy up to 1.69 million shares in Generac, sending Generac's stock rocketing more than 40% after hours. Generac's now set to supply $2.4 billion worth of backup generators for Amazon's data centers. Classic example of how one big deal plugged into the AI infrastructure story can send a stock flying, even if the near-term financials are only part of the picture.

SPEAKER_00 4:56

If you're following these moves, it's easy to see how investor excitement, even more than the deal itself, can amplify a company's price. Sometimes just being in the right part of the tech ecosystem is enough to make investors go wild.

SPEAKER_01 5:10

On a different note, let's shift to the auto sector where good old gasoline engines are making a comeback. GM is launching two new V8 engines for its 2027 trucks, joining Ford and Stellantis in focusing again on gas-powered pickups. Why? Those big trucks are super profitable, even as electric vehicle enthusiasm cools off. Buyers want what they want, and for now, it's towing, hauling, and range.

SPEAKER_00 5:35

Definitely a classic example of how businesses have to balance innovation with what the market is truly asking for right now. For GM and others, strong truck sales are helping support them as they work toward newer technologies down the line.

SPEAKER_01 5:50

And now, let's talk about changing rules around environmental, social, and governance issues, often called ESG. The SEC is proposing to pull back from overseeing shareholder votes on things like climate change and executive pay, saying that it doesn't really have that legal authority. This move would push more responsibility onto state regulators, which often have a reputation for being more company friendly. Critics say it might make it tougher for shareholders to hold boards accountable, especially on environmental or social issues.

SPEAKER_00 6:24

So, for anyone who sees ESG factors as a core part of their investing, this shift could add more uncertainty and make the playing field a lot less predictable across different states.

SPEAKER_01 6:35

As a side note, let's quickly explain a common insurance term you might run into, waiver of subrogation. It basically means an insurance company agrees it won't pursue another party for recovery after paying out a loss, even if that party might otherwise be responsible. You'll see this all the time in commercial contracts. Just be sure to review the agreement and check with professionals before you sign on.

SPEAKER_00 7:00

Let's wrap up with our jargon word of the week. Earnings yield. This is a measure of how much a company earns relative to its stock price. In other words, for every $100 you invest in a stock, earnings yield gives you an idea of what the company could make off that $100 in a year. Sometimes a higher earnings yield can mean a stock is undervalued. Here's an example.

SPEAKER_01 7:24

The company's high earnings yield attracted investors who were looking for potentially undervalued stocks. It's a handy metric to keep in your toolkit when comparing companies.

SPEAKER_00 7:34

That's it for this week's FinLeighty update. Thanks for joining our investing conversation. Check back for more insights, tools, and stories as you take charge of your financial future. Until next time, happy investing.

SPEAKER_01 7:48

We're here to help you navigate the ups and downs. Catch you soon. Just a heads up, everything we talk about on this podcast is for education and general info only. We're not giving financial or investment advice, and we're definitely not telling you what to buy or sell. Finleady isn't a registered advisor, so if you're making money moves, talk to a pro who knows your situation. Cool? Now don't forget to sign up to our newsletter so that you don't miss a market beat.