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.
WEAK JOBS REPORT
The market ended the week slightly higher, despite Friday’s disappointing jobs report for September that fell far short of analyst expectations. U.S. employers added 194,000 payrolls in the month, even fewer than August’s revised print of 366,000 and a far cry from the expectation of 500,000 new jobs. There were reasons for optimism buried in the Department of Labor’s report: average earnings were up, significant upward adjustments were made to August and July reports, and pandemic-caused staffing fluctuations in the education sector “distorted the normal seasonal hiring and layoff patterns,” according to the BLS. But the weak top-line number suggests that the persistent labor shortage combined with the delta wave is continuing to hamper employers’ ability to hire.
GLOBAL ENERGY CRUNCH
U.S. crude oil prices crossed the $80-per-barrel threshold this week, the highest level since 2014 amid a growing global energy crunch that portends higher prices across the board for consumers this winter. The price at the pump is a buck higher than it was this time last year. U.S. coal prices are at a two-year high. And natural gas prices in this country have hit the highest level since 2008. In the UK, natural gas prices are up some 400 percent year-to-date, leading Vladimir Putin this week to step in and say he’d boost Russia’s plentiful gas supply to Europe ahead of the colder months. Energy stocks benefited from a broad rally on rising commodity prices, while airline stocks took a beating on higher fuel costs. JetBlue, American, Delta, and United all ended the week down more than 5 percent.
FACEBOOK UNDER FIRE
Facebook’s no good, very bad autumn continued with a global, hours-long outage on Monday that took its entire suite of apps offline for billions of users around the world, illustrating how dependant much of the internet’s infrastructure has become on the company that’s now at the center of a cascade of controversies over its effects on society. Just as Facebook was able to get its services back online, a whistleblower, who revealed her identity on 60 Minutes last weekend, appeared before Congress to highlight the internal research that is turning into perhaps the company’s worst scandal to date. Frances Haugen, a former Facebook data scientist, testified that the company harms younger users, creates divisions among its user base, and undermines democracy — its most recent high on Sept. 1. But JPMorgan said this week that the dip is a buying opportunity and that the bank sees the stock rising as much as 35 percent.
PEDAL TO THE METAL
General Motors unveiled detailed plans for its transformation from an automaker to a “platform company” that will “redefine how people and goods are moved,” as CEO Mary Barra put it to investors. Barra said GM plans to double annual revenue by 2030 with a focus on electrification, robotaxis, and EV charging infrastructure. The stock barely budged during Barra’s announcements, but then soared higher for a weekly gain of 7 percent. Meanwhile, Elon Musk announced at Tesla’s investor conference that he is moving the company’s headquarters from California to Texas, making good on a threat from last year when Musk called California’s COVID lockdowns “fascist” and said he’d fold up shop. Tesla will continue to expand its production facility in California as it simultaneously builds out a new factory in the Lone Star State.
SQUID GAME MANIA
Netflix shares ended the week on a positive note, buoyed by its global smash hit, Squid Game, which is now on track to be the streamer’s most popular show ever. The sheer scale of Squid Game’s impact on the all-important metric of international subscriber growth — the South Korean series is currently No. 1 in 90 countries — should become more apparent when Netflix releases third-quarter earnings on Oct. 19. In the meantime, the stock hit a new all-time high this week and is up 22 percent so far this year.
Sonos reported better than expected Q1 earnings amid chip shortage with the release of its Roam product. CFO Brittany Bagley joined Cheddar News to discuss the smart speaker maker's successful report and its plans to hit its 2024 targets as people leave their homes as pandemic restrictions ease. "Even as people head out in the world, it doesn't mean they don't like to listen to music at home or watch a streaming movie at home," she said. "So there's still a real role for us and our products in peoples lives, sort of, no matter what else they're doing."
Lynn Martin, president of the NYSE Group, explains why investors at the New York Stock Exchange should still feel confident despite the recent Wall Street volatility and discusses the landscape for 2022 when it comes to IPOs and retail investors.
The merger of WarnerMedia and Discovery received Justice Department approval on Wednesday, and Patty Hirsch, EVP of consumer and digital platforms at WarnerMedia, joined Cheddar News to discuss current and future offerings from the media conglomerate that will control both HBO Max and Discovery+. "Content really drives so much, and CNN has always had a very long history of creating an incredible documentaries, incredible content … and this service I think is going to ultimately provide the kind of content consumers want and the kind of content that consumers are going are going to pay for," she said. Hirsch also discussed NFTs in use through its Turner Sports and DC brands.
Black entrepreneurs lead the way in the creation of new businesses, but they often cannot get the necessary funding to get their business off the ground. The Fearless Fund is on a mission to change that, and help Black business owners get venture capital. The fund also offers a unique grant program meant to help entrepreneurs with growth, peer coaching, and more, including grants between $10,000 and $20,000. Arian Simone, Co-Founder and General Partner of Fearless Fund, joins Closing Bell to discuss the Fund's mission, how it helps Black entrepreneurs, and more.
Multinational food company Kellogg’s reported an earnings beat amid supply chain issues and an extended labor strike. Kellogg’s Chairman and CEO c joined Cheddar News to discuss overcoming the obstacles and what's to come for the company. "The first half of the year is really going to be one about rebuilding inventory, and into the second quarter, starting to reestablish promotional activity for our customers and our consumers," Cahillane said. "And then the back half of the year, obviously, we're really much more back in business, and we expect to exit the year with our business in cereal being just as strong as it's ever been."
Sting has sold his catalog of more than 600 songs for $300 million to Universal Music. The deal gives the label the rights to all of his work, including “Every Breath You Take," as well as all future royalties.
Miller Lite is opening the first branded bar in the metaverse, by way of Decentraland, as a way to advertise during the Super Bowl this year without buying an expensive TV commercial slot. Sofia Colucci, global vice president of Miller Family of Brands, joined Cheddar to talk about the new marketing concept. "We have a lot of great partnerships with NFL teams throughout the year but were shut out of advertising during the Super Bowl game, so this pushes us to think creatively and also think of what feels really relevant right now," Colucci said. "There's no question that there's a lot of excitement with the metaverse, and we wanted to participate but in a way that felt right for Miller Lite."
Plans to add affordable housing to a development in Yellow Springs, Ohio, were squashed after comedian Dave Chappelle and other community members spoke out against the project. Chappelle threatened to pull the plug on his local comedy club and restaurant projects if the development had been approved.
Jason Moser, Senior Analyst at The Motley Fool, joined Wake Up With Cheddar to talk about the big takeaways from Disney's Q1 report, which showed the company nearing 130 million Disney+ subscribers as parks revenue ticks up.
The airline industry is seeing a major consolidation as Frontier and Spirit Airlines have agreed to merge in a deal valued at $6.6 billion dollars. Frontier will control just over 51% of the company, and Spirit will control the other 48%, creating what would become the fifth-largest airline in the U.S. The deal was approved over the weekend, with Spirit CEO Ted Christie saying that the merger aims to create an aggressive, low-fare competitor focused on consumer-friendly pricing. John Grant, Senior Analyst at OAG explains the gravity of the merger, and the wider impact it could have on competition and the airline industry as a whole.
