People walk past the New York Stock Exchange (NYSE) on Wall Street on July 12, 2022 in New York City.
Angela Weiss | AFP | Getty Images
Here are the top stories investors need to start their trading day:
1. More profits to go
Markets have kept their heads above water so far this month, even as economic data points to a possible recession and corporate earnings have been mixed, at best. On that last point, more than 70 S&P 500 companies reported quarterly results this earnings season, and about two-thirds performed better than expected, according to Refinitiv. So there’s been some time yet, and investors will be paying particular attention to what guidance companies have to offer, as economic concerns grow. On Wednesday’s earnings schedule: BoeingAnd AT&TAnd TeslaAnd ibm And Levi Strauss. Read live market updates here.
2. Microsoft slows down
Microsoft signs are seen at the company’s headquarters in Redmond, Wash., January 18, 2023.
Matt Mills McKnight | Reuters
Microsoft It may have beaten street earnings, but the company posted the slowest revenue growth since 2016, and its forecast suggests the bad trends will continue. The tech giant said on Tuesday that it expects revenue growth to continue to slow. Microsoft’s Windows and Office business declined at the end of last year, and further declines are likely to come as the PC market shrinks again. New business growth for the company’s Azure cloud unit also eased in December, which didn’t bode well for the early part of this year. “In our commercial business, we expect the business trends we saw at the end of December to continue into the third quarter,” said Chief Financial Officer Amy Hood.
3. Why inflation is viscous
NEW YORK, NY – JANUARY 12: Eggs are seen on a shelf at a Pioneer Supermarket on January 12, 2023 in the Flatbush neighborhood of Brooklyn in New York City. The outbreak of avian influenza, also known as avian influenza, has led to a shortage of eggs as well as an increase in prices in stores across some parts of the country. (Photo by Michael M. Santiago/Getty Images)
Michael M. Santiago | Getty Images News | Getty Images
Inflation remains high – the consumer price index for December rose 6.5% from a year earlier – but it is slowing. This is good news for consumers, but only up to a point. Many companies have raised prices, but just because costs are lower doesn’t mean they’ll cut prices across the board, CNBC’s Melissa Rybko and Amelia Lucas explain. One reason: Many companies hold long-term contracts that fix prices months in advance for goods and freight. Also, companies that were pressured by higher costs earlier will want to see their profit margins improve. “We don’t take something that was $1, move it to $1.10 and then, after a year or two, move it to $1,” Utz brands CEO Dylan Lysette previously said.
4. Tesla’s influence on car prices
The new Model Y electric cars are parked early in the morning in the parking lot of Terminal 5 of Berlin-Brandenburg Airport in the capital. Due to space constraints at the site of the US electric car manufacturer Tesla’s new plant in Grünheide, there are several thousand new electric cars in the BER airport parking lots.
Patrick Balloul | Image Alliance | Getty Images
Tesla It shook up the auto industry recently when it cut prices on several models in multiple markets. The move came after the electric vehicle leader reported weaker-than-expected year-end deliveries, suggesting that CEO Elon Musk is trying to boost demand. It also puts new pressure on Tesla’s competitors, incl stronghold And GM, as they struggle with rising material costs while trying to ramp up their production of electric vehicles, having set ambitious targets for the next decade. The used market for Teslas is also paying a price: During the first 17 days of January, prices for cars from 2020 or later fell to an average price of $58,657, down from a June peak of $76,626, according to Edmunds. Tesla reports its earnings after Wednesday.
5. The Empire Breaks Out
(L to R) Rupert Murdoch, CEO of News Corp. and chairman of Fox News, and Lachlan Murdoch, co-chairman of 21st Century Fox, walk together as they arrive on day three of the annual Allen & Company Sun Valley Conference, July 13, 2017. In Sun Valley, Idaho.
Rupert Murdoch on Tuesday called off his plan to reunite with the Fox News owner Fox Corporation. And News Corp, owner of The Wall Street Journal and HarperCollins, after deciding “the combination is not optimal for shareholders.” The Murdoch family has effective control of both companies, which make up a vast but fading empire to the interests of the media. In October, Fox and News Corp. formed a special committee to explore a potential deal, which would have re-merged the two companies nearly 10 years after they split. But some large non-Murdoch shareholders have rejected it, suggesting that this would not be an easy move for the media mogul and his son, Lachlan Murdoch, who is a senior executive at both companies. Meanwhile, News Corp. is in advanced talks to sell Move Inc. , owner of realtor.com, to CoStar Group.
— CNBC’s Yun Lee, Jordan Novette, Melissa Rybko, Amelia Lucas, Michael Wayland, and Lillian Rizzo contributed to this report.
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