Here are the most important news items that investors need to start their trading day:
1. Losing streaks
For the third day in a row, stocks opened higher and looked like they were headed for gains only to turn negative as the day wore on. The S&P 500 and Nasdaq Composite both notched four-day losing streaks on Wednesday, dropping 0.58% and 1.15%, respectively. The Dow Jones Industrial Average had its seventh negative session of the last eight with a 0.12% loss. Tech was the worst-performing S&P 500 sector, falling 1.7%. Looking ahead, initial jobless claims data are due on Thursday morning, while Netflix will report earnings in the afternoon. Follow live market updates.
2. Google cuts
A view of Google Headquarters in Mountain View, California, United States on April 16, 2024.
Tayfun Coskun | Anadolu | Getty Images
Alphabet Chief Financial Officer Ruth Porat said in a memo Wednesday that the tech giant will restructure its finance team, including layoffs and relocations. The cuts are part of a broader effort by Google to rearrange people and resources to invest in new technologies like artificial intelligence and come as advertising growth has slowed. Unrelated to that restructuring, the company also terminated 28 employees Wednesday after multi-city protests during which employees spoke out about labor conditions and the company’s contract with the Israeli government, according to a separate memo.
3. Soaring, flying
A Delta Airlines plane takeoff from San Francisco International Airport (SFO) in San Francisco, California, United States on February 21, 2024.
Tayfun Coskun | Anadolu | Getty Images
Airline executives say they’re not seeing any signs of a slowdown despite recent high-profile safety issues in the aviation world. In fact, Delta Air Lines and United Airlines said they’re expecting record travel this summer, and the industry is forecasting even more interest in first-class tickets. Air travel demand has remained strong even as inflation has weighed on consumers and as public and regulatory scrutiny of the industry has increased since a door plug blew out of a Boeing 737 Max 9 in January.
4. AI chip boost
A logo of Taiwan Semiconductor Manufacturing Company (TSMC) is seen during the TSMC global RnD Center opening ceremony in Hsinchu on July 28, 2023. (Photo by Amber Wang / AFP)
Amber Wang | Afp | Getty Images
Taiwan Semiconductor Manufacturing Company on Thursday beat expectations for revenue and profit in the first quarter. TSMC was lifted by a strong demand for advanced chips, particularly those used in AI applications. The company said net revenue rose 16.5% to 592.64 billion New Taiwan dollars ($18.87 billion), while net income increased 8.9% from a year ago. TSMC is the world’s largest producer of advanced processors and has major clients such as Nvidia and Apple.
5. Fed watchers
U.S. Federal Reserve Chair Jerome Powell holds a press conference following a two-day meeting of the Federal Open Market Committee on interest rate policy in Washington on March 20, 2024.
Elizabeth Frantz | Reuters
Wall Street is starting to wonder if the Federal Reserve will cut rates at all in 2024. The Fed has long stated that it’s targeting an inflation goal of 2%, but with most readings putting inflation around 3%, where it’s lingered for several months, the Fed finds itself trudging along on the last mile toward its goal. The CME Group’s FedWatch gauge shows traders are still expecting rate cuts later this year, but are pricing in about a 71% probability that the Fed will wait until September. Bank of America economists forecast one cut in December, but warned there is a “real risk” that the Fed won’t cut until March 2025 “at the earliest.”
— CNBC’s Alex Harring, Jennifer Elias, Hayden Field, Leslie Josephs, Sheila Chiang and Jeff Cox contributed to this report.
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