MARKET RECAP
⭐️ The S&P Continues Record-Setting Recovery After Strong June Jobs Report

😍 The bull market continues!

👷 After a better-than-expected jobs report (with unemployment falling to 4.1% when economists had expected an increase), investors are optimistic, with the S&P 500 flying up to all-time highs just in time for the 4th of July 🇺🇸

• The S&P 500 is up +1.7%

• The Nasdaq-100 is up +1.5%

• Bitcoin is up +2%

🇻🇳 Trump also announced a US-Vietnam trade agreement on Wednesday, as the President’s 90-day tariff pause comes to an end on July 9th.

😰 Despite the optimism, many commentators are nervous about July 9th, with fears that a ‘tariff war flare-up’ may be just around the corner.

👀 The Bank of America’s Michael Hartnett even came out and said the S&P 500 is close to a ‘sell signal’, pointing out that the US % of the global equity market has also soared to all-time-highs and saying:

🎯 Now Hartnett is known as a contrarian, and there are many other analysts pointing out that the market hitting all-time highs doesn’t mean a good reason to sell (or not to buy).

⏰ One interesting study showed that waiting for a 10% pullback in the markets resulted in a lower average return than investing at the high, as ‘time in the markets’ tends to beat ‘timing the markets’.

🤷‍♂️ Personally, I think there are nuggets of truth in both perspectives, and last week I increased my International exposure, picking up some $ZEA, but over 40% of my portfolio is still comfortably in the S&P 500, and trying to swing trade the S&P 500 has historically proved to be a poor strategy.

✍️ Also this week, Trump’s “Big Beautiful Bill” passed the House and the Senate, with multi-trillion dollar implications for Healthcare, Student Aid, and EVs - and speaking about EVs, we have to talk about Tesla and their record EV sales plunge.

😎 Since we already covered Tesla and the Robotaxi launch last week, I’ll keep this part short so we have time to talk about Robinhood ($HOOD)'s meteoric +900% stock rise since 2024 and the launch of ‘tokenized stocks’, but first, here’s the quick Tesla rundown:

QUICK TESLA UPDATE
📉 Tesla Reports Another Record Sales Plunge

• 📉 This week Tesla ($TSLA) reported only selling 384,122 cars over Q2, down -13.5% the year before, another record sales plunge from last year.

• 📈 Despite this, the stock actually jumped 4% after the sales announcement on Wednesday, as analysts expected a much larger drop.

• 😰 EV sales across other car-makers are up overall, with many attributing Tesla’s drop to the political controversy that has surrounded the brand.

• 📝 Trump’s ‘Big Beautiful Bill’ (that passed this week) is bad news for Tesla as the EV credits are set to go away, which last year accounted for 39% of Tesla’s annual net income.

• Musk and Trump beefed online again this week with Musk calling Trump’s bill a ‘disgusting abomination’ in one last attempt to get it killed. Trump of course snapped back saying:

Of course, Elon has said repeatedly that the real value of Tesla is in the Robotaxi and the Optimus robot, so Tesla investors were largely unphased with the stock only falling -3% this week.

Ok - enough about Tesla, before we turn attention to Robinhood a quick word from today’s sponsor State Street Global Advisors!

PRESENTED BY STATE STREET
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^{(1) S&P Global Indices, spglobal.com (2) Bloomberg Finance L.P., as of February 5, 2025. (3) S&P Global Indices spglobal.com (4) Forbes, The World's Most Valuable Brands List (5) FactSet as of December 31, 2024 (6) FactSet as of December 31, 2024}

^{*See Important Risk Information at the end of the newsletter!}

TOP STORY
🚀 Robinhood Is Up 10x Over the Past Year and a Half - What’s Behind the Rise?

🎯 For our top story today I want to take a bit of a mini deep dive into a stock that’s had an insane bounce back over the past 1.5 years - Robinhood.

🗑️ The stock was once in the absolute dump. From its IPO in July 2021 to the end of 2023, the stock tumbled, falling a massive -80%. But since all-time lows, Robinhood has over 10x’ed, recovering all its losses and surging to new all-time-highs.

🤔 So what’s driven this insane growth? Crypto.

🚀 In Q4 2023, Crypto transaction revenue was a measly $43M (9% of total revenues). But in Q1 2025, it’s grown to $252M (27% of revenue), accounting for nearly half of Robinhood’s total revenue growth.

Options revenue has also doubled, from $121M to $240M.

💰 Analysts at JPMorgan point to the ‘maturing nature of Robinhood’s platform’ and note how ‘products can be rolled out with little incremental expenses’ and cross-sold to Robinhood’s growing customer base. In addition to growing the number of users, Robinhood has nearly doubled its average revenue per user as the company evolves from a meme-stock trading app to a fintech giant.

🪙 The Launch of Tokenized Stocks (including OpenAI and SpaceX)

✨ As crypto has become more and more important to Robinhood, it has been leaning in more heavily into that side of the business, with the May acquisition of Canadian crypto company WonderFi, the June acquisition of Bitstamp, and most recently, the rollout of ‘Stock Tokens’ in the EU.

🔗 Robinhood’s Stock Tokens are ‘token wrappers’ linked to real stocks, enabling near-instant settlement and 24/7 trading. This move positions Robinhood as a competitor to major exchanges like the NYSE and the NASDAQ and opens up a large new revenue opportunity for Robinhood.

🚪 Potentially even more interesting, Robinhood says the Stock Tokens open the door for retail investors to get exposure to private companies, offering OpenAI and SpaceX stock tokens as part of a giveaway. While this has led to a lot of controversy (with Sam Altman from OpenAI issuing a warning and saying they were ‘not involved in this, and do not endorse it’), Robinhood CEO Vlad Tenev says they’ve been ‘hearing from many private companies eager to join in the tokenization revolution’.

🔮 The Future of Robinhood

✅ Analysts are overall optimistic about the future for Robinhood, with many increasing price targets after the recent announcements, excited by Robinhood’s moves to double down on crypto.

👀 Personally, I’ll definitely be keeping a closer eye on Robinhood (and on the roll-out of the ‘Stock Tokens’) and will be sure to keep you all updated on this incredible comeback story! I’m not a shareholder yet, but will certainly be adding $HOOD to my watchlist and researching the stock more over the next few weeks.

FROM THE BLOSSOM COMMUNITY
⭐️ Featured Discussions this Week

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