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.
NETFLIX CRATERS
The streaming wars left a crater in Netflix's stock price Wednesday after the company reported a loss of 200,000 subscribers in the first quarter. Shares plunged 35 percent, wiping out $50 billion in value in a single day, and marking the streamer's worst day on Wall Street since 2004. While analysts were expecting subscriber growth to slow given increasingly fierce competition from the likes of Disney, Warner Bros. Discovery, and Paramount, the steep drop-off was a surprise and a signal that the streaming market may be bumping up against its limit. Netflix is also the second FANG stock (Facebook, Amazon, Netflix, Google) to endure a brutal sell-off this year. Meta dropped 26 percent back in February, lopping off $232 billion in value from its market cap. The other members of the tech giant-quartet, which has been a reliable investment for several years now, are set to release their earnings next week. So we'll know soon if the bearish contagion spreads.
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TESLA EARNINGS IMPRESS
Maybe Musk was just feeling himself after a Tesla earnings report knocked it out of the park this week. The company reported a record profit of $3.3 billion in the quarter, and Musk projected that the company would produce 1.5 million vehicles in 2022. That's a 60 percent jump from last year, despite signals in the report that supply chain issues were finally catching up with the EV maker and could curb production in the next quarter. The stock jumped around 3 percent on the news, and Tesla bulls rejoiced.
More Musk media moments:
WINNERS AND LOSERS
While Netflix plunged and Tesla popped, the rest of the stock market was a similarly mixed bag. Used-car retailer Carvana reported its first-ever quarterly sales decline, and the stock fell as much as 24 percent after-hours on Wednesday before leveling off. On the same day, United Airlines forecasted it would be turning a profit in 2022, sending shares up nearly 18 percent, as investors anticipated a resurgent airline industry this summer. Bank of America shares jumped on an earnings beat, and Charles Schwab shares fell after missing analyst estimates. Shares of Chinese ride-hailing giant Didi, meanwhile, sank on the news that it plans to delist from the New York Stock Exchange before finding another venue for its U.S. shares.
MORE FED RATE HIKES
When Federal Reserve Chair Jerome Powell speaks, markets listen, and this week the country's top banker hinted in recent months that sharp interest rate hikes are coming. He even signaled that a half-point increase was on the table, putting him in line with some of the more hawkish Fed governors who have been calling for faster, steeper hikes to rein in inflation.
RISE OF THE DOLLAR
One beneficiary of looming rate hikes is the U.S. dollar. The dollar index (DXY), which tracks the dollar's value against other major currencies, hit a two-year high this week. The U.S. dollar is up 12 percent from last year, and other currencies are sinking against it, with the Japanese yen, in particular, tumbling to a 20-year low.
The State Department had been in talks with Elon Musk’s Tesla company to buy armored electric vehicles, but the plans have been put on hold by the Trump administration after reports emerged about a potential $400 million purchase. A State Department spokesperson said the electric car company owned by Musk was the only one that expressed interest back in May 2024. The deal with Tesla was only in its planning phases but it was forecast to be the largest contract of the year. It shows how some of his wealth has come and was still expected to come from taxpayers.
At 100 years old, the Goodyear Blimp is an ageless star in the sky. The 246-foot-long airship will be in the background of the Daytona 500 — flying roughly 1,500 feet above Daytona International Speedway, actually — to celebrate its greatest anniversary tour. Even though remote camera technologies are improving regularly and changing the landscape of aerial footage, the blimp continues to carve out a niche. At Daytona, with the usual 40-car field racing around a 2½-mile superspeedway, views from the blimp aptly provide the scope of the event.
You'll just have to wait for interest rates (and prices) to go down. Plus, this deal's a steel, the big carmaker wedding is off, and bribery is back, baby!
It’s a chicken-and-egg problem: Restaurants are struggling with record-high U.S. egg prices, but their omelets, scrambles and huevos rancheros may be part of the problem. Breakfast is booming at U.S. eateries. First Watch, a restaurant chain that serves breakfast, brunch and lunch, nearly quadrupled its locations over the past decade to 570. Fast-food chains like Starbucks and Wendy's added more egg-filled breakfast items. In normal times, egg producers could meet the demand. But a bird flu outbreak that has forced them to slaughter their flocks is making supplies scarcer and pushing up prices. Some restaurants like Waffle House have added a surcharge to offset their costs.
William Falcon, CEO and Founder of Lightning AI, discusses the ongoing feud between Elon Musk and Sam Altman, and how everyday people can use AI in their lives.
U.S. tariffs on steel and aluminum “will not go unanswered,” European Union chief Ursula von der Leyen vowed on Tuesday, adding that they will trigger toug
The Trump administration has ordered the Consumer Financial Protection Bureau to stop nearly all its work, effectively shutting down the agency that was created to protect consumers after the 2008 financial crisis and subprime mortgage-lending scandal. Russell Vought is the newly installed director of the Office of Management and Budget. Vought directed the CFPB in a Saturday night email to stop work on proposed rules, to suspend the effective dates on any rules that were finalized but not yet effective, and to stop investigative work and not begin any new investigations. The agency has been a target of conservatives since President Barack Obama created it following the 2007-2008 financial crisis.
