Markets were were virtually unchanged for the week heading into Friday’s session which saw the S&P 500 fall 2.73% while cryptocurrencies pulled back as well. A heavy week of earnings pushed airlines higher following some strong results while tech stocks fell.
Headlines
Netflix (NFLX) got perhaps the most attention this week outside of Twitter (TWTR) with the streaming service’s shares falling more than 35% after reporting a subscriber loss for the first time in ten years and forecasting a further loss for the current quarter. The service is gonna need more than one Witcher to get rid of these demons.
Meanwhile, Twitter stock rose more than 8% during a week filled with Elon Musk discussing his plans to acquire the social media platform. Twitter responded late last week with a “poison pill” that would allow for shares to be acquired at a discounted rate by other shareholders should one individual take a 15% or higher ownership stake.
Documents filed Thursday show Musk has secured much of the funding needed to acquire the social media company, but the company’s board has yet to formally respond. Despite several not particularly vague tweets about a potential tender offer, Musk has yet to formally attempt such a move.
Additionally, the company’s former CEO, Jack Dorsey, criticized the boards amid recent developments. The stock remains roughly 24% higher since the announcement of Musk taking an ownership stake in the company.
Earnings
Earnings season continued with major players such as Tesla (TSLA), Bank of America (BAC), Charles Schwab (SCHW), Johnson & Johnson (JNJ), IBM (IBM), Verizon (VZ), AT&T (T), and many others publishing quarterly results.
United Airlines (UAL) and American Airlines (AAL) shares both saw a boost following strong earnings reports with United forecasting a full-year 2022 profit while American Airlines’ second quarter is now forecasted to top its 2019 results. Airlines still have some ways to go to reach the profitability from before COVID, but they are in a much better place now.
Elsewhere, Tesla shares rose following a record profit with the company announcing a robotaxi vehicle it plans to start producing in 2024. Shares of Baker Hughes (BKR) fell following its earnings and revenue miss as the firm struggles to move people and equipment into Russia due to recent sanctions levied against the country. Lastly, AT&T stock rose after surpassing earnings projections with phone subscribers growing more than expected.
Economic Data
While earnings were heavy this week economic data remained relatively light with housing being the primary focus as housing starts, building permits, and existing home sales data for March were released. Permits and starts both managed to surpass estimates while existing sales came in slightly below expectations and existing sales fell from February. Permits and starts also have both been on a steady incline since the pandemic while completions have remained relatively flat as supply chain disruptions have led to delays in finishing production.
Meanwhile, initial unemployment claims came in below estimates and inched lower from 186,000 to 184,000 claims with continuing claims dropping from 1.475 million to 1.417 million.
All in all, the S&P 500 dropped 2.73%, the Dow Jones Industrial Average fell 1.74%, and the NASDAQ lost 3.70%.
