Big Business This Week 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.
RIVIAN'S RAISE
The electric vehicle manufacturer spooked investors this week by issuing a $1.5 billion bond to raise money – after raising $1.3 billion earlier this year. However, the company insists cash is not an issue; it is trying to get ahead of borrowing that could get costlier in the future. Rivian announced this week that it is on track to begin construction on a Georgia factory, which comes in addition to work that is expected to begin on sites in Colorado, Texas and California in the next few months. Rivian stock dropped almost 13 percent this week.
COSTCO CEO
Costco CEO W. Craig Jelinek is stepping down, but his replacement is already well-versed on the warehouse store. President Ron Vachris, a 40-year veteran of Costco, will take over in January. Jelinek will stay on until April to help with the transition. No word on the fate of the $1.50 hot dog and soda combo deal that Jelinek has held onto for decades. The stock dropped slightly on the news of his departure, down almost 3 percent for the week.
NOKIA CUTS
Wireless network giant Nokia is about to cut 14,000 jobs globally in the face of a weak market and falling profits. The company aims to cut its costs nearly in half by the end of 2026. It hopes the development of cloud computing and artificial intelligence becomes a boon to its own business, as tech companies will continue to need the networks it provides. The stock was down nearly 11 percent this week.
WYNDHAM STAYS
Wyndham Hotels & Resorts could be up for sale, but not for the $8 billion offered by Choice Hotels, the parent company of brands like Radisson, Quality Inn and Park Plaza. Apparently, the companies had been negotiating a potential deal out of the public eye for months, but when talks broke down Choice announced its bid. Wyndham's board unanimously turned it down and said it was "underwhelming, highly conditional and subject to significant business, regulatory and execution risk." Choice Hotels CEO indicated more negotiations may be possible. Wyndham stockholders were pleased with the decision, sending the stock up 8 percent this week, while Choice Hotels investors pulled back with the stock dropping 9 percent.
RITE AID BANKRUPTCY
The week started with bad news from pharmacy chain Rite Aid. It filed for Chapter 11 bankruptcy protection as it tries to work its way out of a mess of hundreds of millions of dollars of fiscal losses and opioid lawsuit settlements. It says it has already secured $3.45 billion in financing to get through restructuring, but it'll close more than 150 stores in the process - about 7 percent of its total footprint. Rite Aid stock closed the week up a whopping 47 percent, although that only brought the stock price up to 26 cents per share.
Chris Williamson, Chief Business Economist at S&P Global, breaks down September’s CPI print and inflation trends, explaining what it means for markets.
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.
