The Week's Top Stories is a guided tour through the biggest market stories of the week, from winning stocks to brutal dips to the facts and forecasts generating buzz on Wall Street.
RATE HIKE READY
At the Jackson Hole Economic Symposium Friday, Federal Reserve Chairman Jerome Powell said the U.S. should prepare for more interest rate hikes. The Fed has implemented a pretty steady stream of increases since March 2022 when it was near zero to 5.4 percent, the highest it has been in 22 years. The inflation rate has dropped significantly during that period, from 9.1 percent to 3.2 percent, but it's still too far above the target rate of 2 percent for the Fed. Employment levels have remained strong throughout this period. The real estate seems to have taken the brunt of the impact, with mortgage rates hitting a new 22-year high average of 7.23 percent for a 30-year fixed-rate.
UPS AVOIDS STRIKE
There was good news for online shoppers this week: UPS struck a deal with workers that will avoid a strike. In the five-year deal, the shipping giant has agreed to increase and standardize pay, end forced overtime on drivers' days off, and add air conditioning to more trucks. The same cannot be said for the United Auto Workers union at the moment. This week autoworkers overwhelmingly voted to allow union leaders to call a strike if negotiations with General Motors, Ford and Stellantis don't start making some serious headway before the current contract expires on September 14.
DOLLAR TREE CHALLENGES
Dollar Tree has plenty of work on its hands. Its earnings report released this week beat Wall Street expectations, but the stock sunk as the company reported a difficult economy ahead. The discount store chain, which also owns Family Dollar, cited theft as a major issue. This week, Dollar Tree also received an order from the Labor Department giving it two years to turn around institutional failures that have created safety concerns in stores throughout the country. The company will have to figure out what is causing stores to do things like block emergency exits and stack boxes to dangerously tall heights - and then figure out how to fix it in all locations.
NVIDIA SOARS ON AI
Nvidia revealed an incredible quarter in this week's earnings report. The computer chip giant made nine times more revenue than it did a year ago, largely thanks to the AI companies that are relying on its technology, and it expects to triple sales this quarter. The news sent the stock up 6 percent - just another milestone for the stock which has tripled in value this year.
PELOTON PLUNGES
Peloton stock dropped more than 20 percent on Wednesday after the company admitted it is struggling to keep up with demand for replacement seat posts that were recalled over safety concerns. While riders are without functional bikes, 20,000 of them have paused their subscriptions, which is a critical part of the company's business plan. In a letter to shareholders, President and CEO Barry McCarthy also noted consumers seem to be turning more toward travel and experiences, which is tough for a stay-at-home bike company.
The Supreme Court will reconsider race-based affirmative action in college admissions. The court will examine admissions policies at Harvard University and The University of North Carolina Chapel Hill, which count the race of applicants as a factor in admissions. The court has upheld affirmative action policies in the past, saying it helps to create more diverse student bodies. However, the conservative Supreme Court could be skeptical and even possibly hostile to such policies. Nick Anderson, Higher Education Writer, Washington Post joined Cheddar's Opening Bell to discuss.
The value of most cryptocurrencies have plummeted in recent months since reaching all-time highs in November, wiping out more than $1 trillion in value globally. The steep crash has some talking about the possibility of a crypto winter, a term referring to a prolonged bearish period where asset prices persistently fall over many months. This all comes as the Fed is expected to raise interest rates, and the Biden administration is working on an executive order to regulate Bitcoin and other assets. Josh Goodbody, COO of Qredo, joined Cheddar's Opening Bell to discuss the crypto crash, and how the industry might recover from it.
Recent data reveals that streaming giants are struggling to retain subscribers in the months following a major release.
According to data from Antenna, subscriber trends show that users will subscribe to a given streaming service just to watch a particular show, and then cancel those subscriptions shortly after. This comes as the streaming space continues to heat up as new entrants crowd the space. Jon Christian, Founding Partner + Digital Supply Chain Leader at OnPrem joined Cheddar's Opening Bell to discuss.
The EU relaxed its Covid travel restrictions for vaccinated individuals among the union's 27 member states, doing away with testing or quarantine requirements for travelers. This comes soon after the World Health Organization said the omicron variant could help make the pandemic more manageable. The new rules take effect February 1st. Bryce Conway, Founder, 10xTravel joined Cheddar's Opening Bell to discuss.
If you're in China you may have noticed that the 1999 film "Fight Club" which features Brad Pitt has somehow got itself a new ending. In the new ending on the streaming service Tencent, the narrator is killed and the explosions are replaced with a black screen saying "the police arrested criminals".It's unclear as to exactly why the changes were made. However, it is the latest example of China playing by its own rules when it comes to entertainment and attempting to control everything its citizens watch. Media Reporter at Axios, Sarah Fisher, joined Cheddar to discuss more.
Some of Tiktok's biggest stars have a message for the platform: It is time to pay up! As the platform has skyrocketed in popularity, many content creators have been given the opportunity to garner millions of fans and even sometimes billions of views. In 2020, the company launched a creator fund in order to incentivize the platform's users. However, while the group of creators has grown larger, the pool of money has remained the same, and creators are fed up, they claim as Tiktok becomes more successful. Senior Editor at Engadget, Karissa Bell, joined Cheddar to discuss more.
In 2021, QAnon, the community which traffics in conspiracy theories saw a rapid growth in its numbers. As a result of vaccine rollouts, a number of conspiracies surrounding them also began to circulate which then led to the rise of "Anti-Vaxxers". As a result, the QAnon and anti-vax communities have become increasingly intertwined and the results could be costing lives. Senior Researcher at Media Matters Alex Kaplan, joined Cheddar to discuss more.
Neil Young gave the streaming service Spotify an ultimatum demanding that his music be removed if the Joe Rogan experience remained on the platform. Joe Rogan's platform has been questioned a number of times as a result of some of his takes on covid treatment strategies and at times downright misinformation. Ultimately, Spotify decided to stick with Joe Rogan's podcast. The Director for the Business and Entertainment Program at American University, John Simson, joined Cheddar to discuss more.
Nutritional supplement beverage company Athletic Greens has achieved unicorn status. The company announced a new $115 million funding round, bringing its valuation to $1.2 billion. The company's flagship product AG1 combines 75 different vitamins, minerals, and other nutrients into one daily serving. Athletic Greens says it is poised to reach the millions of consumers who are currently driving the health and wellness market's exponential growth. Athletic Greens founder and CEO Chris Ashenden joins Cheddar News' Closing Bell to discuss.
