The following are the key news stories that investors should be aware of before beginning their trading day:
1. Technology fails
This week’s major averages are being weighed down by tech companies due to a number of disappointing big earnings announcements. After its quarterly report on Wednesday, Google parent Alphabet saw a decline of more than 9%, and on Thursday morning, premarket trading saw another 2% decline.
2. Top Selection
Following a highly followed succession battle, Morgan Stanley has picked its next CEO. Ted Pick will join the bank’s board of directors and take over for James Gorman as of January 1. As the head of Morgan Stanley’s Wall Street operations, including trading and investment banking, Pick has extensive experience in the industry. It comes as no surprise that Gorman is leaving and that his replacement is already employed: The bank had three internal contenders to succeed the departing CEO, who announced in May that he would leave down within the year. Gorman will continue in his role as executive chairman of the board at Morgan Stanley.
3. Reported for
There’s a speaker in the House again. After two weeks of fruitless attempts to unseat outgoing Speaker Rep. Kevin McCarthy, the Republican-led chamber picked GOP Rep. Mike Johnson as its new leader on Wednesday.
4. Giant Meta Profits
The parent company of Facebook, Meta, announced a 23% increase in quarterly revenue on Wednesday—its highest growth rate since 2021. The company outperformed Wall Street’s forecasts for profits per share by over 70 cents, both on the top and bottom lines. With 3.05 billion monthly active users, the company’s range of services met analyst forecasts. However, the metaverse-focused Reality Labs division of Meta saw a 26% decline in revenue and an operational loss of $3.74 billion. The division’s operating losses are anticipated by the business “to climb considerably year-over-year.”
5. The shift towards Ford
The first of the three major manufacturers to negotiate a tentative labour agreement following nearly six weeks of worker strikes was Ford and the United Auto Workers union on Wednesday. A day before Ford releases its third-quarter profits report, a tentative agreement was reached that will see 57,000 union-represented employees of the business receive pay hikes of 25%, cost-of-living adjustments, and other contract enhancements. While the agreement is sent to UAW executives for approval and subsequently to members for a ratification vote, Ford’s striking employees will resume work.
Source (CNBC)
