Happy Wednesday, Munchers! 🙏

Praying for everyone's portfolios after "all hell broke loose" yesterday.

As always, here is your daily dose of the news that matters, from Wall Street to Dalal Street - in 5 minutes and 12 seconds.

Let’s dive in.

What’s hot, what’s not?

Market Commentary

• Most global markets bled massively after US inflation came in higher than expected.

• Indian markets haven't opened yet, but I expect lots of red.

• American stocks suffered the worst selloff since June 2020.

Story Roundup

1 - Wall Street suffers worst day in almost 2 years. 📉

US stocks took a scooter to the ankle after some inflation data came out.

The biggest indices in the world suffered their worst day since the COVID crash - with a 5-6% fall in most global markets.

Inflation in the world's largest economy was expected at 8.1%, but printed at 8.3%.

This raised the fear of more interest rate hikes, sending stocks plummeting.

It also says one big thing - inflation is stubborn.

So at this point, using demand-side rate hikes to control supply-side inflation seems like using a sledgehammer to do open heart surgery. 🤔

2 - JPMorgan warns of a "50% drop in investment banking fees". 💸

JP Morgan warned that 3rd quarter investment banking revenues could be as much as 50% lower.

The head of their investment bank said that layoffs would be slow to come - since cutting bankers immediately could lead to pressure on future growth.

Belts on Wall Street are getting tighter - revenues have already fallen 44% for the first few months of 2022.

Goldman has planned to cut 5% of it's workforce and has paused hiring for new bankers.

Slowdown szn. 💀

3 - Russia's budget surplus crumbles over low energy revenues. 🛢️

President Putin's budget surplus for the month of August was essentially vaporized - falling to it's first deficit of the year.

This decline is attributed to a sharp slowdown in oil & gas revenues.

Russian gas flows to Europe have now fully stopped, robbing them of leverage over the continent.

International oil prices have also slumped - falling from ~$130 a barrel to ~$90.

Russia was outplaying the rest of the world - but what do they have in store now?

4 - German government drops $67bn on struggling energy firms. 🔥

Germany's state bank will be deploying almost $70bn toward failing energy businesses.

General consensus is that soaring energy prices could trigger a wave of bankruptcies - and the government wants to avoid this.

This move comes after gas firm VNG applied for aid, and another energy company Uniper was bailed out by the government.

Slippery business. 👾

5 - Even OPEC is confused about the oil sell-off. 🪔

The OPEC oil cartel said that they are getting "erroneous signals" from the market.

They've pushed back against predictions that global economic growth will tank, leading to reduction in oil demand.

OPEC sees oil demand back at pre-pandemic levels in 2023 - which would mark a stunning recovery of global economies.

They argue that oil market fundamentals are "unchanged" amid markets weaving a story of weakening outlook and destroyed demand.

Heavy bets. 🪨

A few nibbles from Yep.

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Hope you enjoyed this issue of the Market Munch. If you've got any feedback - good or bad (😏) you can hit reply to this email. Thanks a ton for reading!

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Cheers, and have a lovely day. 🙏

Aryaansh