Five interesting things that Hodges Capital research analysts discovered this week...

#1 GYPSUM WALLBOARD SHIPMENTS: This week, the Gypsum Association reported that shipments of gypsum wallboard increased by 4.4% in the second quarter of 2024, which exceeded most Wallstreet analysts' expectations given the uncertainty in new home construction. Furthermore, wallboard pricing appears stable, which should bode well for manufacturing profit margins among the major producers.

#2 CHATBOT ADOPTION: According to Valens Research, over half of the U.S. population is aware of AI chatbot ChatGPT. However, only one-third of the population has used it, and only 7% use it daily, suggesting that the adoption of such artificial intelligence tools is still in the early stages.

#3 PRIME TIME: Last week, Amazon (AMZN) reported that sales for its annual "Prime Day" hit a record of $14.2 billion, increasing 11% from a year ago. Sales growth was driven by net new demand rather than inflation.         

#4 CORPORATE DEBT BURDEN: As a result of a recent moderation in rates, interest expense as a percentage of total corporate debt is no longer on the rise and sits 0.10% below its high of 4.1%, according to Strategas.  

#5 INTEREST RATES: In response to recently moderating inflation data, the futures market at the beginning of this week was pricing in a 96% probability of a 25-basis point cut at the September FOMC meeting compared to a 61% chance a month ago. Furthermore, the futures market expectations for the terminal rate have decreased to 3.5% from 3.9% for the next easing cycle.

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