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.
MARKETS MANAGE A WIN
Stocks broke a seven-week losing streak, the longest such streak since 2001, ending up broadly across sectors as investors reviewed earnings data. Encouraging news from the Commerce Department showed that inflation rose to a still-high 6.3 percent in April from a year earlier, but it was the first hint of a slowdown since November 2020, a sign that high prices might be moderating for the moment.
TO INFINITY, AND BEYOND MEAT
Beyond Meat needed a miracle. The stock was down nearly 90 percent from its all-time high, and plant-based meat sales were stuck in place. So the company brought on Kim Kardashian as a "chief taste consultant," who apparently is a big fan of the product, but even that didn't appear to be enough. Shares slid another 10 percent on Tuesday. Though now it looks like Kim's star power just needed some time to sink in, as shares of Beyond Meat shot up nearly 12 percent on Wednesday. The rally offered some relief for the beleaguered stock, but some are still not convinced that Beyond is the future of food.
ABERCROMBIE CRUMBLES
If you thought stitch sweater polos were immune to inflation, think again. Shares of Abercrombie & Fitch fell 25 percent after the company reported a $14.8 million net loss for the first quarter and a dimmer outlook for the coming quarter. CEO Fran Horowitz said higher prices related to freight and raw material costs were putting a dent in consumer confidence, even as the company banked on its clientele to keep shelling out for expensive casual wear. The stock bounced back Wednesday along with a number of retail stocks after the Fed released its latest FOMC minutes, which confirmed the central bank's plan to move ahead with interest rate hikes so that it has flexibility later in the year.
OH SNAP
In a note to employees, Snap CEO Evan Spiegel warned that the macro environment had "deteriorated further and faster than we anticipated," due to a cutback in digital ad spending related to inflation. The note came just one month after the company released its last earnings report, which already wasn't looking too good for the social media company. Shares plunged 43 percent, on top of a more than 50 percent drop since the beginning of the year, and other tech stocks that rely on advertising followed suit. Meta, Twitter, Roku, and Google parent Alphabet all dropped on Tuesday.
Broad gains in the markets were led by tech stocks this week despite the Snap news, with heavy-hitters like Microsoft, Apple, and Amazon all seeing their shares rise.
DISPATCHES FROM DAVOS
The world's richest and most powerful individuals gathered in Switzerland this week for the annual Davos conference, and the vibes were decidedly not good. German Chancellor Olaf Scholz condemned the Russian invasion. International Monetary Fund Managing Director Kristalina Georgieva bemoaned the breakdown of the global economic order, and legendary investor George Soros said that the Russian "invasion may have been the beginning of the Third World War and our civilization may not survive it.”
The Rev. Al Sharpton is set to lead a protest march on Wall Street to urge corporate America to resist the Trump administration’s campaign to roll back diversity, equity and inclusion initiatives. The New York civil rights leader will join clergy, labor and community leaders Thursday in a demonstration through Manhattan’s Financial District that’s timed with the anniversary of the Civil Rights-era March on Washington in 1963. Sharpton called DEI the “civil rights fight of our generation." He and other Black leaders have called for boycotting American retailers that scaled backed policies and programs aimed at bolstering diversity and reducing discrimination in their ranks.
President Donald Trump's administration last month awarded a $1.2 billion contract to build and operate what's expected to become the nation’s largest immigration detention complex to a tiny Virginia firm with no experience running correction facilities.
Chipmaker Nvidia is poised to release a quarterly report that could provide a better sense of whether the stock market has been riding an overhyped artificial intelligence bubble or is being propelled by a technological boom that’s still gathering momentum.
Cracker Barrel said late Tuesday it’s returning to its old logo after critics — including President Donald Trump — protested the company’s plan to modernize.
Low-value imports are losing their duty-free status in the U.S. this week as part of President Donald Trump's agenda for making the nation less dependent on foreign goods. A widely used customs exemption for international shipments worth $800 or less is set to end starting on Friday. Trump already ended the “de minimis” rule for inexpensive items sent from China and Hong Kong, but having to pay import taxes on small parcels from everywhere else likely will be a big change for some small businesses and online shoppers. Purchases that previously entered the U.S. without needing to clear customs will be subject to the origin country’s tariff rate, which can range from 10% to 50%.
Southwest Airlines will soon require plus-size travelers to pay for an extra seat in advance if they can't fit within the armrests of one seat. This change is part of several updates the airline is making. The new rule starts on Jan. 27, the same day Southwest begins assigning seats. Currently, plus-size passengers can pay for an extra seat in advance and later get a refund, or request a free extra seat at the airport. Under the new policy, refunds are still possible but not guaranteed. Southwest said in a statement it is updating policies to prepare for assigned seating next year.
Cracker Barrel is sticking with its new logo. For now. But the chain is also apologizing to fans who were angered when the change was announced last week.
Elon Musk on Monday targeted Apple and OpenAI in an antitrust lawsuit alleging that the iPhone maker and the ChatGPT maker are teaming up to thwart competition in artificial intelligence.
