Happy weekend, Munchers! 🙏

This week has been a long one. Hope you had a fun Friday of partying.

As always, here is your daily dose of the news that matters, from Wall Street to Dalal Street - in 4 minutes and 53 seconds.

That's less time than it takes for the Downing Street race to begin, AmEx to start getting shudders, and Biden to warn that his competitors will crash the economy. 🔥

Let’s dive in.

What’s hot, what’s not?

Market Commentary

• Stocks around the world advanced strongly as traders bet that interest rates won't be hiked super aggressively.

• It looks like we've been caught in yet another rally upwards even if the bear market hasn't stopped plaguing us.

• UK markets continue to remain stormy as investors keep tugging each way on both the Pound and gilts.

Story Roundup

1 - Challengers line up for the keys to 10 Downing Street. 👑

Liz Truss's resignation kicked off a race for her place.

Investors and traders alike had a flashback as Boris Johnson's party members scrambled to secure nominations from MPs.

If he manages to get to the mark of 100 nominations, he'll be able to enter Monday's ballot to replace Liz Truss.

He'll have to square up against Rishi Sunak - his former Chancellor and current rival.

BoJo himself was forced to resign as PM in July after some criticism over personal conduct.

A former Conservative leader called the BoJo comeback "the worst idea" he'd heard in 46 years.

I reckon Diwali might be coming to Downing Street. ⚡

2 - American Express thinks that credit losses are gonna surge. 💸

AmEx thinks that the US consumer may not be in great state.

The credit card co. set aside more money for defaults than expected - a sign that Mr. Average Joe might be suffering more than we think.

Many of the biggest US banks have also followed a similar strategy. That's because a tighter economy bites consumers, and they may start falling behind on their mortgage payments, payday loans, or BNPL purchases.

Spending behavior is changing - which means saving behavior is changing in hand.

Time will tell where this one goes. 🚀

3 - Italy gets their first Female PM. ✊

Italy's getting a far-Right, female PM for the first time in history.

Her name's Giorgia Meloni - and she's taking the reigns at a very tricky time.

The situation in Italy seems to be balancing on a knife's edge - as they're dealing with a severe energy crisis, spiking cost of living, and a lot of political instability.

Her goal for yesterday was to "get this nation a government as soon as possible".

Let's hope her goal for today is more ambitious. 🤔

4 - Biden warns that his opps will "crash economy". 😅

Joe Biden's got some stuff to say about his opposition party.

The US midterm elections are coming up soon - and he's keen to keep his own party in power.

Biden is a Democrat, and he warned that electing a Republican would do all sorts of thing.

This goes all the way from "exploding the deficit" and "being irresponsible" to "crashing the American economy".

On the other end of the stick are the Republicans themselves, who've got Biden in a tight spot with the inflation narrative.

It's anyone's game. 🎲

5 - Adidas hits the red alert on profits. 🚨

Adidas just gave out their 2nd profit warning in 3 months.

Investors didn't like this. Their stock tanked 10%, and here is exactly why.

• Red-alarm being sounded on profits. Adidas profits are gonna be down 60% this year according to management, with operating margins getting slimer by 4-5%.

• Unsold inventory. A lot of it. Adidas has a lot of sneakers in their warehouses. In fact, they have way too much. They're being forced to store all this extra inventory when it isn't moving quick.

• Slimming margins. Already wafer-thin margins have been worsened by higher producer-end inflation. This takes a big dent out of every company's bottom line. If you input is more expensive, your output will also be up there. 😏

Adidas also controversially ended a deal with rapper Kanye West that paid them $1.7 billion a year.

I side with Kanye on this one. 🤷

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Have a chill Saturday folks. One love. ❤️

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