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.
DEBT CEILING UPDATE
Lawmakers reportedly made some progress on debt talks, with Republicans and Democrats working toward a potential deal to raise the federal ceiling but largely limit spending over the next two years. On the table are defense spending and contoversial investments in the IRS. The Biden administration is also working out a contingency plan to potentially delay payments to the U.S. Treasury. The Dow Jones jumped over 300 points going into Memorial Day weekend as hopes rose that the federal government would not default.
NVIDIA SPARKS RALLY
The stock market also got a boost on Thursday after chipmaker Nvidia reported a 20 percent jump in revenue from the previous quarter, mostly due to the artificial intelligence boom fueling demand for high-end semiconductors. The company's shares surged more than 25 percent following the report and helped spark a rally across the tech sector. “The computer industry is going through two simultaneous transitions — accelerated computing and generative AI,” CEO Jensen Huang in a statement.
DUMPING DOLLAR TREE
Meanwhile, Dollar Tree's stock fell more than 16 percent after the company disappointed on earnings and lowered its profit outlook for the year. The earnings miss reflects a number of headwinds facing the discount retailer, among them higher levels of shrink and a shift to lower-margin consumables. These challenges have been felt across the sector, which has struggled with changes to consumer demand post-pandemic.
BEST BUY BEATS
Bucking the trend, however, is Best Buy. The technology retailer's stock is up nearly 5 percent for the week on the back of an earnings report that beat Wall Street estimates. Tempering the rally though is the fact that Best Buy is still expecting weaker spending on consumer electronics in the coming year. “What we would say is we’ve been seeing a consumer who is — whether or not you call it a recession — exhibiting some recessionary behaviors,” CEO Corie Barry told investors.
Nvidia on Wednesday became the first public company to reach a market capitalization of $5 trillion. The ravenous appetite for the Silicon Valley company’s chips is the main reason that the company’s stock price has increased so rapidly since early 2023.
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.
