A Boeing 737 MAX jet heads to a landing at Boeing Field following a test flight Monday, June 29, 2020, in Seattle. The jet took off from Boeing Field earlier in the day, the start of three days of re-certification test flights that mark a step toward returning the aircraft to passenger service. The Federal Aviation Administration test flights over the next three days will evaluate Boeing's proposed changes to the automated flight control system on the MAX, a system that activated erroneously on two flights that crashed, killing 346 people. (AP Photo/Elaine Thompson)
From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
U.S.-CHINA TENSION HITS MARKETS
Stocks broadly fell on Wall Street Friday amid increased tensions between the United States and China, in addition to a mixed batch of earnings reports. The U.S. and China went back and forth with orders to close consulates, drawing concerns from investors also dealing with the surging cases of coronavirus in the American South and the uptick in filings for unemployment benefits last week. The uncertainty in the markets, as technology and health care companies accounted for much of the selling, led to a record rise in the price of gold.
TECH TUMBLES
Tech companies did their part dragging down markets by the end of this week, despite a series of impressive earnings reports. Tesla beats made it eligible for the S&P, but the stock price still dropped as investors wonder where the EV-maker can go from here. Social media giants Twitter and Snap both saw their user bases grow, but a dearth of advertising dollars in the industry are raising questions about how they're going to make money in Q3. Intel stock also plummeted after indicating the storied manufacturer may move away from producing its own chips.
VACCINES AND TREATMENTS
Even as the number of coronavirus cases in the U.S. surpassed 4 million this week, some glimmers of hope came in the form of potential vaccines. Pharma companies Pfizer and BioNTech made a nearly $2 billion deal with the federal government to deliver a working vaccine. The deal pushed stocks higher on Wednesday. Sorrento Therapeutics also received a big boost on the news that the FDA approved their COVID-19 treatment Abivertinib for a Phase 2 trial on hospitalized patients.
BOEING MAX UPDATE
Don't expect the Boeing 737 MAX to hit the skies in 2020, according to a report this week from The Wall Street Journal. But for investors, some news was better than no news: stock ticked up on the report. Boeing got another ding on Friday, though, as the FAA warned airlines to inspect older models of the 737 NG and Classic that haven't flown for a week over corrosion that could possibly lead to engine failure.
MICROSOFT'S HARD KNOCKS
Tech giant Microsoft reported some stellar earnings news on Wednesday, beating analyst expectations on revenue by nearly $1.5 billion, as the coronavirus drove demand for the company's tools for remote work. But, the stock still fell nearly 2.5 percent on news of slowing growth for its Azure business. On top of that, the messaging app company Slack filed a complaint against Microsoft with the European Commission, citing anti-competitive behavior. Slack accused Microsoft of having "illegally tied" its Teams product to Office. Microsoft, however, added some positivity to the week announcing its part in a coalition of large companies called Transform to Net Zero with the goal of achieving carbon negativity by the year 2030.
A big-screen adaptation of the anime “Chainsaw Man” has topped the North American box office, beating a Springsteen biopic and “Black Phone 2.” The movie earned $17.25 million in the U.S. and Canada this weekend. “Black Phone 2” fell to second place with $13 million. Two new releases, the rom-com “Regretting You” and “Springsteen — Deliver Me From Nowhere,” earned $12.85 million and $9.1 million, respectively. “Chainsaw Man – The Movie: Reze Arc” is based on the manga series about a demon hunter. It's another win for Sony-owned Crunchyroll, which also released a “Demon Slayer” film last month that debuted to a record $70 million.
The Federal Aviation Administration says flights departing for Los Angeles International Airport were halted briefly due to a staffing shortage at a Southern California air traffic facility. The FAA issued a temporary ground stop at one of the world’s busiest airports on Sunday morning soon after U.S. Transportation Secretary Sean Duffy predicted that travelers would see more flights delayed as the nation’s air traffic controllers work without pay during the federal government shutdown. The hold on planes taking off for LAX lasted an hour and 45 minutes and didn't appear to cause continued problems. The FAA said staffing shortages also delayed planes headed to Washington, Chicago and Newark, New Jersey on Sunday.
Boeing workers at three Midwest plants where military aircraft and weapons are developed have voted to reject the company’s latest contract offer and to continue a strike that started almost three months ago. The strike by about 3,200 machinists at the plants in the Missouri cities of St. Louis and St. Charles, and in Mascoutah, Illinois, is smaller in scale than a walkout last year by 33,000 Boeing workers who assemble commercial jetliners. The president of the International Association of Machinists says Sunday's outcome shows Boeing hasn't adequately addressed wages and retirement benefits. Boeing says Sunday's vote was close with 51% of union members opposing the revised offer.
The stunning indictment that led to the arrest of more than 30 people — including Miami Heat guard Terry Rozier and other NBA figures — has drawn new scrutiny of the booming business of sports betting in the U.S. The multibillion-dollar industry has made it easy for sports fans — and even some players — to wager on everything from the outcome of games to that of a single play with just a few taps of a cellphone. But regulating the rapidly-growing industry has proven to be a challenge. Professional sports leagues’ own role in promoting gambling has also raised eyebrows.
Tesla, the car company run by Elon Musk, reported Wednesday that it sold more vehicles in the past three months after boycotts hit hard earlier this year, but profits still fell sharply. Third-quarter earnings fell to $1.4 billion, from $2.2 billion a year earlier. Excluding charges, per share profit of 50 cents came in below analysts' estimate. Tesla shares fell 3.5% in after-hours trading. Musk said the company's robotaxi service, which is available in Austin, Texas, and San Francisco, will roll out to as many as 10 other metro areas by the end of the year.
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