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.
RECESSION OUTLOOK
The International Monetary Fund (IMF) started the week off on a downbeat with a prediction that global growth will stick to around 3 percent, which would make the weakest medium term growth projection since 1990. It would also come in well below the 3.8 percent average of the past few decades. “With rising geopolitical tensions and still-high inflation, a robust recovery remains elusive,” said IMF Managing Director Kristalina Georgieva.
CINEWORLD CRASHES
Regal parent company Cineworld saw its stock plunge 36 percent earlier this week following the announcement of a reorganization plan that would not benefit shareholders. The movie theater chain previously said shareholders would take the hit from the bankruptcy process, but its latest announcement snuffed out any remaining hopes of being made whole through some kind of sales process. “The proposed restructuring does not provide for any recovery for holders of Cineworld’s existing equity interests,” Cineworld said in a statement.
WARNER BROS. DISCOVERY DROPS
Shares of Warner Bros. Discovery fell nearly 9 percent this week after the entertainment giant announced that it was renaming its streaming service from HBO Max to simply "Max." The new super-streamer will reshuffle the company's offerings under a single umbrella, bringing together programming from Warner Brothers, HBO, Discovery, Food Network, and HGTV. In addition to some misgivings about the rebranding, investors remain skeptical about the prospects for the conglomerate, which formed out of a merger completed in 2021.
BITCOIN RALLIES
Bitcoin is regaining some of its losses from the past year, as much of the crypto economy collapsed due to a combination of fraud, financial mismanagement, and regulatory pressure. The world's biggest cryptocurrency went above $30,000 for the first time in 10 months, a threshold it last crossed in June 2022. Short sellers have lost millions in the run up.
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Spain's government has fined Airbnb 64 million euros or $75 million for advertising unlicensed tourist rentals. The consumer rights ministry announced the fine on Monday. The ministry stated that many listings lacked proper license numbers or included incorrect information. The move is part of Spain's ongoing efforts to regulate short-term rental companies amid a housing affordability crisis especially in popular urban areas. The ministry ordered Airbnb in May to remove around 65,000 listings for similar violations. The government's consumer rights minister emphasized the impact on families struggling with housing. Airbnb said it plans to challenge the fine in court.
Roomba maker iRobot has filed for Chapter 11 bankruptcy protection, but says that it doesn’t expect any disruptions to devices as the more than 30-year-old company is taken private under a restructuring process. iRobot said that it is being acquired by Picea through a court-supervised process. Picea is the company's primary contract manufacturer. The Bedford, Massachusetts-based anticipates completing the prepackaged chapter 11 process by February.
Serbia’s prosecutor for organized crime has charged a government minister and three others with abuse of position and falsifying of documents related to a luxury real estate project linked to U.S. President Donald Trump’s son-in-law Jared Kushner. The charges came on Monday. The investigation centers on a controversy over a a bombed-out military complex in central Belgrade that was a protected cultural heritage zone but that is facing redevelopment as a luxury compound by a company linked to Kushner. The $500 million proposal to build a high-rise hotel, offices and shops at the site has met fierce opposition from experts at home and abroad. Selakovic and others allegedly illegally lifted the protection status for the site by falsifying documentation.
